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Western Orissa Sugar Ltd.

BSE: 507462 Sector: Agri and agri inputs
NSE: N.A. ISIN Code: N.A.
BSE 05:30 | 01 Jan Western Orissa Sugar Ltd
NSE 05:30 | 01 Jan Western Orissa Sugar Ltd

Western Orissa Sugar Ltd. (WESTERNORISSUG) - Auditors Report

Company auditors report

ANNUAL REPORT 1998-99 WESTERN ORISSA SUGAR LIMITED AUDITORS' REPORT To the Members of Western Orissa Sugar Limited I. We have examined the attached Balance sheet of WESTERN ORISSA SUGAR LIMITED, as at 31st March,1999 and the annexed Profit and Loss Account for the year ended on that which are in agreement with the books of account. II. In our opinion the Profit and Loss Account and Balance sheet comply with the requirements of the Accounting Standard referred to in sub section (3C) of section 211 of the Companies Act-1956 except to the extent indicated in VI (d) below. III. As required by the Manufacturing and Other Companies (Auditors' Report) Order, 1988 and on the basis of such examination of the books and records of the Company as we considered appropriate and the information and explanations given to us during the course of our audit, we enclose in the 'Annexure' a statement on the matters specified in paragraphs 4 and 5 of the said order. IV. Our observations on various matters are set out in para VI below, of which, those against paras VI- (b)(d) and (e) are in respect of certain expense and for losses, which would have had effect on the years loss, and consequently, on the net worth position as at the end of the year under audit. V. Further to the above, we report 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, subject to our observations in paras VI-(b) (d) and (e). (b) Subject to our observations set out in para V-(b), (d) and (e) in our opinion, proper books of account as required by law have been maintained by the Company, so far as appears from our examination of those books, and (c) In our opinion and to the best of our information and according to the explanations given to us, the said accounts, subject to our observations in paras VI and read in conjunction with the notes thereon, give the information required by the Companies Act, 1956 in the manner so required, and give, subject to our observations in para VI below, 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 Profit and Loss Account, of the loss for the year ended on that date. VI. Attention is drawn to our following observations, together with the notes on Schedule Q: (a) The continuation of the company as going concern is dependent upon the availability of the adequate finance and future profitability of the Company [Note: 2 (c)]. (b) Additional liabilities, if any, on overdue payments for secured & unsecured loans, including interest, have neither been ascertained nor provided for in the accounts. (c) Necessary charges required to be created with respect to the zero interest Secured Redeemable Non Convertible Debenture, [Note: 2(e)(V)]. (d) Cash basis of accounting, instead of the accrual method has been followed in the case of: Interest on Loans other than SDF Loans and Bank Borrowings, the amount being unascertained. Certain Portion of disputed Lease rent amounting to Rs. 192.00 lacs. Receipt of Insurance claim and subsidy . (e) Extent of recoverability of certain advances as indicated in Annexure, point (8) here in after has neither been ascertained nor provided for in the accounts. For and on behalf of N.N.Das & Co Chartered Accountants S.Ghosal Partner Place: Nandanvan, Orissa Date : 27 November,1999. ANNEXURE TO THE AUDITORS' REPORT (Referred to in Paragraph III of our Report of even date) 1. Records showing full particulars including quantitative details and situation for fixed assets acquired at Company's Project division in Nandanvan, Thasil Dharamgarh, Dist Kalahandi is maintained. However such records need to be improved to fulfil the requirements. The records for assets acquired and physically transferred by other closed units/ divisions are still under compilation. We are informed that the physical verification has been conducted by the Management during the year and no material discrepancies were noticed between such physical verification and records to the extent built up. We are also informed that adjustment can only be done when the combined Register is constructed. 2. The Fixed assets of the Company have not been revalued during the year. 3. We are informed that the stock of finished goods, stores, spare parts and raw materials of the Company have been physically verified by the management during the year. 4. In our opinion, the procedure of physical verification of stocks followed by the management were found to be reasonable and adequate in relation to the size of the Company and nature of its business. 5. The discrepancies between the physical and the book stocks, to the extent ascertained, were, in our opinion, no material, and have been properly dealt with in the books of accounts. 6. In our opinion, the valuation of stocks is fair and proper, in accordance with the normally accepted accounting principles, and is on the same basis as in the earlier year. 7. The Company has during the year neither taken nor granted any secured or unsecured loans from/to the Companies, firms and other parties listed in the Register maintained under Section 301 of the Companies Act, 1956 or from/to the Companies under same management as defined under sub section (1B) of Section 370 of the Companies Act, 1956. 8. Loans, and advances in the nature of loans, given to employees, farmers, and other parties by the Company's Project Division at Nandanvan are generally being recovered as stipulated restipulated, where such stipulations/ restipulations exist, except principal amount of loans and interest thereon from farmers and others amounting to Rs 383 lacs for which we are given to understand that reasonable steps are being taken to recover/adjust such loans. 9. In our opinion, and according to the information and explanations given to us, the internal control procedures are generally adequate and commensurate with the size of the Company and nature of its business for purchase of stores and raw materials, including components, plant and machinery, equipments, and other similar assets and for the sale of goods. 10. According to the information and explanations given to us, the Company has not entered into transactions of purchase of goods, materials and services, and sale of goods, materials and services, in pursuance of contracts or arrangements entered in the Register maintained under section 301 of the Companies Act, 1956 and aggregating during the year to Rs.50,000/- or more in value in respect of each party. 11. As explained to us, there were no unserviceable or damaged stores, raw materials, or finished goods at the end of the year requiring provision for loss. 12. In regard to the deposits accepted from public the Company has complied with the provisions of Section 58 A of the Companies Act,1956 except as indicated in note 2(h) of Schedule Q. 13. In our opinion, the Company has maintained reasonable records for sale of by-products. 14. The Company has an internal audit system commensurate with its size and nature of its business. 15. The Central Government has not been prescribed under Section 209 (i) (d) of the Companies Act, 1956 the maintenance of cost records of the product of the Company. 16. Provident Fund dues have generally been regularly deposited during the year with the appropriate authorities. We have been informed that employees of the Company are not covered under the Employees State Insurance Scheme. 17. In our opinion and according to information and explanations given to us, there ae no disputed amounts payable in respect of income tax, sales tax, custom duty and excise duty outstanding as at 31st March, 1999 which are outstanding for a period of more than six months from the date they become payable. 18. During the course of our examination of the books of accounts, we have not come across any personal expenses which have not been charged to the profit and Loss Account, other than those payable under contractual obligation or in accordance with generally accepted business practice. 19. 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 Provision) Act, 1985. For and on behalf of N.N.Das & Co. Chartered Accountants S.Ghosal Partner Place: Nandanvan,Orissa Date : 27 November,1999.