AHURA WELDING ELECTRODE MANUFACTURING LIMITED
ANNUAL REPORT 2003-2004
M/s. Ahura Welding Electrode Manufacturing Ltd.
1) We have audited the attached balance Sheet of M/s. Ahura Welding
Electrode Manufacturing Ltd., Coimbatore, as at 31st March 2004 and also
the Profit and Loss account for the year ended on that date annexure there
2) We conducted our audit in accordance with the 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 disclosures
in the financial statements. 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.
3) As required by the Companies (Auditor's Reports) Order 2003 issued by
the Central Government of India in terms of sub-section (4A) of section
227 of the Companies Act, 1956, we enclosed in the Annexure a statement on
the matters specified in paragraphs 4 and 5 of the said Order.
4) Further to our comments in the Annexure referred to in paragraph (1)
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 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 dealt with by this
report are in agreement with the books of accounts:
IV) In our opinion the Profit and Loss Account and the Balance Sheet dealt
with by this report comply with the accounting standards referred to in
sub section (3C) of sec. 211 of the companies Act, 1956 except Accounting
Standard 6 depreciation Accounting issued by the Institute of Chartered
Accountants of India. The Deviations are mentioned in Note No.3.
V) On the basis of written representations received from the Directors as
on 31st March 2004 and taken on record by the Board of Directors, we report
that none of the Directors is disqualified as on 31st March 2004, from
being appointed as Directors m terms of clause (g) of subsection (f) of
section 274 of the Company Act, 1956,
VI) In our opinion and to the best of our information and according to the
explanations given to us, the said Balance sheet and Profit & Loss account
read together with the notes thereon. In particular note no:7 regarding
non- Confirmation / reconciliation of balance of some parties shown under
Sundry Creditors, Sundry Debtors, Loans & Advances, if any., 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:
(i) In the case of the Balance Sheet of the State of Affairs of the company
as at 31st March 2004 and
(ii) In the case of Profit and Loss Account, of the Loss for the period
ended on that date.
For S.P.ANANDAKUMAR & CO.,
Place : Coimbatore
Date : 8th December 2004
ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE
1) The company has not maintained proper records showing full particulars
including quantitative details and situation of fixed assets. We are
informed that the assets have been physically verified by the management
during the year and no material discrepancies have been noticed on such
verification. Deviations are reported in Note No: 5 regarding Fixed Assets.
2) The stock of finished goods, stores, spare parts and raw materials, have
been physically verified during the period by management in our opinion,
the frequency of verification is reasonable.
3) The procedures of physical verification of stocks followed by the
management are reasonable and adequate in relation to the size of the
company and nature of its business.
4) As explained to us, there were no material discrepancies noticed on
physical verification of the stocks of raw materials, stores and spares and
finished goods, having regard to the size of the operations.
5) There are no loans taken from parties listed in the register maintained
under section 301 of the companies act, 1956.
6) In respect of loans, secured or unsecured, given to companies, firms or
other parties listed in the register maintained under section 301 & 370
(1B) of the Companies Act, 1956, the rate of interest is not prima facie
prejudicial to the interest of the company. There is no recovery of
interest though the same is debited to the parties account. Also there is
no stipulation for re-payment of the loans.
7) In respect of other advances in the nature of loans given to the
employees, they are repaying the principal and interest wherever
8) In our opinion and according to the information and explanation given to
us, there is adequate internal control procedure commensurate with the size
of the company and the nature of its business for the purchase of spare
parts, machinery, equipment's and other assets and for the sale of goods.
9) There are no transaction of purchase of goods and materials and sale of
goods, materials and services made in pursuance of contracts or agreements
entered in the register maintained under section 301 of the Companies Act,
1956 and aggregating during the period to Rs.50,000 or more.
10) The company has a regular procedure for determination of unserviceable
or damaged stores and raw materials including components and finished gods.
Adequate provisions has been made in the accounts for the loss arising on
the items so determined.
11) During the period, the Company has not accepted any deposits from the
12) In our opinion and according to the information and explanation given
to us, the company has maintained reasonable records for the sale and
disposal of waste and scrap.
13) There was no releasable by product for this company during the period.
The company has maintained reasonable records for the sale and disposal of
waste and scrap.
14) The company internal audit system, which in our opinion is commensurate
with the size and nature of the company.
15) The maintenance of cost records for the industry in which the company
is engaged has not been prescribed by the central government under section
209 (1) (d) of the Companies Act, 1956.
16) The company is yet to deposit the provident fund dues amounting to
Rs.5,42,316/- as on 31.03.2003.
17) To the best of our knowledge and according to the information and
explanations given to us, there is some specified amounts payable in
respect on ESI, income tax, wealth-tax, sales-tax, customs duty and excise
duty which were outstanding for a period of more than 6 months from the
date they become payable as on 31st March 2004. The Expected amount payable
will not be judgeable because the company was closed.
18) To the best of our knowledge and on the basis of information and
explanation given to us there are no personnel expenses charged to revenue
account other than the expenses under the service contract obligations with
the company, employee's and / or generally accepted business practices.
19) The company is not 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.
For S.P ANANDAKUMAR & CO.,
(Sd) S.P Anandakumar
Place : Coimbatore
Date : 8th December 2004