RHUTU UDYOG (INDIA) LIMITED
The Share Holders of
M/s Rhutu Udyog (India) Limited
Secunderabad - A.P.
We have Audited the attached Balance Sheet of M/s Rhutu Udyog (India)
Limited, Secunderabad, as at 31st March, 1998 and the Profit and Loss
Account for the period ended on that date annexed thereto and report that:
1. As required by the Manufacturing and the Other Companies
(Auditor's Report) Orders, 1998 issued by the Company Law Board in terms of
Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraph 4 and 5 of the said order.
2. Further to the above and subject to our comments in the annexure
referred to in paragraph 1 above.
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 such books.
c) The Balance Sheet and Profit and Loss Account referred to in this report
are in agreement with the books of account.
d) In our opinion and to the best of our information and according to the
explanation given to us, the accounts subject to Note No.d regarding Inter
Corporate Investments, give a true and fair view.
i) In the case of Balance Sheet of the State of Affairs of the Company as
at 31st March, 1998.
ii) In the case of the Profit and Loss Account of the Profit of the period
ended on that date.
for HARI VARA PRASADA & ASSOCIATES
Place: Secunderabad Y. Hari Vara Prasada Rao
Date : 27th June, 1998 Proprietor
ANNEXURE TO THE AUDITOR'S REPORT
a) The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets. The
management has carried out a physical verification of fixed assets and as
explained to us, no serious discrepancies have been noticed on such
b) None of the fixed assets have been revalued during the year.
c) The management has conducted physical verification in respect of stocks
at reasonable intervals.
d) The procedure of the 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.
e) We have been informed no material discrepancies have been noticed on
physical verification of stocks as compared to book records.
f) The valuation of stocks is fair and proper in accordance with the
normally accepted accounting principles.
g). The Company has not taken any Loans, Secured or Unsecured from
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 sub-section (1B) of section 370 of the
Companies Act, 1956.
h). The Company has not granted any Loans Secured of Unsecured to
companies, firms or other parties listed in the register maintained under
section 301 of the Companies Act, 1956 or from companies under the same
management as defined under sub section (1B) of section 370 of the
Companies Act, 1956.
i). In respect of Loans & Advances in the nature of loans given by the
Company, the parties have been reasonably regular in payment of Principal
and interest amount, in case of overdues reasonable steps have been taken
by the Company for recovery of the overdues.
j) In our opinion, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its business
for purchase of stocks and other assets and for the sale of goods.
k) In our opinion and according to the information and explanations given
to us, the transactions of purchase of goods and materials and services,
made in pursuance of contracts, arrangements entered in the register
maintained under section 301 of the Companies Act, 1956 and aggregating
during the year to Rs. 50000/- or more in respect of each party have been
made at prices which are reasonable having to the prevailing market prices
at which transactions to similar goods, materials or services have been
made with other parties.
l) On the basis of valuation by persons responsible for physical
verification of stocks, there were no unserviceable or damaged stocks.
m) In our opinion and according to the information and explanations given
to us, the company has complied with the provisions of section 58-A of the
Companies Act, 1956 and the Companies (Acceptance of Deposit) Rules, 1875
with regard to acceptance of deposits.
n) In opinion, reasonable records have been maintained by the company for
the sale and disposal of scrap. The company has not by products.
o) The Company do not have an internal Audit Cell.
p) Payment of provident fund and employee's state insurance is not yet
applicable to the Company as informed by the Company.
q) The Central Government has not prescribed maintenance of cost records
under section 209 (1) (d) of the Companies Act, 1956 for any products of
r) According to the information and explanations given to us no undisputed
amounts payable in respect of Income Tax, Wealth Tax, Sales Tax, Customs
Duty and Excise Duty were outstanding as at 31st March, 1998 for a period
more than six months from the date they become payable.
s) No personal expenses have been charged to revenue accounts during the
year under audit.
t) 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.
for HARI VARA PRASADA & ASSOCIATES,
Place:Secunderabad (Y. Hari Vara Prasada Rao)
Date :27th June, 1998 Proprietor