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Polymechplast Machines Ltd has informed that in the limited review report of the Company for the quarter ended September 30, 2007, the Auditors of the Company have made the following observations:
There are certain income, expenditure, provisions and certain inventory at branch were not considered while publishing the Unaudited Financial Results of the Company for the 2nd quarter ended September 30, 2007. As a result of which the net loss as per Unaudited Financial results published by the Company would be increased by Rs 53,000 as per the details shown under :
Following changes are made in the books of accounts for the period July 01, 2007 to September 30, 2007, after submitting the Unaudited Financial Statements:
(i) Increase in Consumption of Raw Material : Rs 5,32,000
(ii) Increase in Employees cost : Rs 1000
(iii) Decrease in Manufacturing Exp : Rs (5,03,000)
(iv) Increase in Administrative Exp : Rs 23,000
Net Decrease in Profit : RS 53,000
Oudh Sugar Mills Ltd has informed that in the limited review report of the Company for the quarter ended September 30, 2007, the Auditors of the Company have made the following observations:
1. No adjustment has been made in respect of certain realizations in earlier years aggregating to Rs 165.51 lacs and interest payable thereon, if any, in case of refund of such realizations, since the matters thereof are under adjudication and the impact of such non adjustment on the Companys loss is presently not ascertainable.
2. The Company has recognized Deterred Tax Asset (net) of Rs 945.94 lacs (including Rs 764.38 lacs for the quarter) in terms of Accounting Standard 22 and MAT Credit Entitlement of Rs 721.50 lacs upto September 30, 2007 based on the future profitability projections made by the management. However, the Auditors are unable to express any opinion on the above projections and their consequent impact, if any, on such recognition of Deferred Tax Asset and MAT Credit Entitlement.
Had such impact been considered, there would be a loss of Rs 3159.30 lacs as against the reported loss of Rs 1491.86 lacs for the quarter.
Tainwala Chemicals & Plastics India Ltd has informed that in the limited review report of the Company for the quarter ended September 30, 2007, the Auditors of the Company have made the following observations:
1. The Company has not made any adjustment on account of Accounting Standard (AS) 15 (revised 2005) Employee benefits applicable to the Company with effect from April 01, 2007 which, as mentioned in note 4 of attached financial results, would be given effect at the year end. The impact of the above, if any, on the profit before and after tax and basic and diluted earnings per share of the Company for the quarter and the half-year ended September 30, 2007 could not be ascertained.
2. The following qualification was mentioned in the Audit Report dated June 28, 2007 on the audited financial statements for the year ended March 31, 2007 and also continues to apply to this quarterly and half year financial results:
The Auditors are unable to express an opinion as to when and what extent long outstanding receivables aggregating to Rs 7,823,588 due from a company in which relatives of directors are interested, without having any stipulation for its repayment, would be recovered. In the opinion of the management, in view of substantial improvement in the operations of that Company, the aforesaid amount is likely to be recovered in due course and, therefore, in their opinion, no provisioning is required at this stage.
Ruchi Soya Industries Ltd has informed that in the limited review report of the Company for the quarter ended September 30, 2007, the Auditors of the Company have made the following observations:
1. In November 2005, the Income Tax authorities carried out an action u/s. 132(1) of the Income Tax Act on the Company, its group companies, associate companies and promoters (the group). Though, the action has been concluded, consequential proceedings such as assessments / reassessments are pending.
For the year ended March 31, 2006, income relating to two of the companies, which amalgamated with the Company w.e.f. April 01, 2005 has been offered in return of the Company for the A.Y. 2006-07 and tax thereon has been provided for in the accounts for the year ended March 31, 2007. Pending completion of assessment / reassessment proceedings, no provision has been made towards additional liability, if any, (amount of which is not ascertainable) that may arise in this regard. The management, however, does not expect any liability of a material amount to arise for the Company.
Umang Dairies Ltd has informed that in the limited review report of the Company for the quarter ended September 30, 2007, the Auditors of the Company have made the following observations:
1. Attention in invited to:
(a) Regarding preparation of Financial results on the basis of Going Concern Concept despite negative net worth for the reasons stated in the Note No. 6 of Schedule 15 of the Audited Accounts for the year ended March 31, 2007.
(b) Regarding management perception about recoverable amount of fixed assets of the Company being more than carrying amount as stated in Note No 14 of Schedule 15 of the Audited Accounts for the year ended March 31, 2007.
(c) Regarding certain balances of debtors, creditors and other liabilities (including advance from customers), financial institution and bank (term loan) are in process of confirmation / reconciliation.
2. As stated in Note No. 3 & 4 of the accompanying financial results for the quarter ended September 30, 2007 the Company has not provided [non provision of interest, penal interest etc. in earlier period(s) as stated in Note No.(3) and for the quarter / half year ended September 30, 2007 as stated in the Note No.(4)] Interest on Term Loans, Debentures and advance against debentures and penal interest / liquidated damages etc. thereon (amount unascertained).
Sterling Holiday Resorts India Ltd has informed that in the limited review report of the Company for the quarter ended September 30, 2007, the Auditors of the Company have made the following observations:
1. The Gratuity liability for the quarter ended September 30, 2007 has been provided based for on an estimate basis. The Company has not ascertained the Gratuity liability at the end of the period as per the basis given in the Accounting standard - AS 15 (revised). Hence the additional provision on this account, if required to be made, has not been considered in the results. The Company has also not ascertained and provided for the liability towards Short Term employee benefits like leave encashment, leave travel allowance and bonus for the quarter ended September 30, 2007.
2. The Company is negotiating with certain unsecured creditors for settlement of their liabilities including principal and interest. Pending final settlement, the quantum of unprovided interest and penal interest that may eventually arise is unascertainable and hence not provided for.
3. The Company has entered into an agreement for One Time Settlement (OTS) of dues to Bank(s) subject to certain conditions which are pending for compliance by the Company. Impact thereof by way of interest and / or penal interest is not ascertainable and hence not provided for.
The effect of Auditors observations in Para (1) to (3) above would have the effect of overstatement of profits for the quarter ended September 30, 2007 which is not ascertainable at this stage.
Further, in respect of the observations in the limited review report, the management has clarified as follows:
Para 1:
With regard to provision of Gratuity to employees on an estimated basis, liability under this head is provided for, based on an actuarial valuation at annual interval and accordingly the same will be accounted in the year end, i.e. March 31, 2008. As regards short term employee benefits, the same will be given effect to in the year end.
Hind Syntex Ltd has informed that in the limited review report of the Company for the quarter ended September 30, 2007, the Auditors of the Company have made the following observations:
1. The depreciation on plant and machinery is charged on the basis of continuous process plant as in the earlier years.
2. The Company would review impairment of its assets in accordance with Accounting Standard 28, Impairment of Assets, on year end.
3. The Company would review additional obligation, if any in accordance with Accounting Standard - 15 (Revised 2005) on Employee Benefit at the year end.
4. As per Accounting Standard - 22, Accounting for Taxes on Income, the Company has deferred tax asset on account of timing differences of Rs 41,03,617/- during this quarter. However, the Company has not considered deferred tax asset during the quarter and the same will be considered at the year end.
DCM Ltd has informed that in the limited review report of the Company for the quarter ended September 30, 2007, the Auditors of the Company have made the following observations:
1. The Companys Scheme of Restructuring and Arrangement (SORA), sanctioned by the High Court of Delhi, provides that it is required to be implemented as a whole and in totality. The effect of the financial and business restructuring, as envisaged in the above Scheme, has already been considered in preparing the accounts by the Company during the previous years except for the sale of rights in the Companys land development project, which, as per SORA, is subject to certain definitive agreements. Although the Company has entered into the definitive agreements during the previous years, one of such agreements, viz., leasehold definitive agreement, has not become effective pending compliance with certain conditions contained therein and, therefore, the corresponding transaction has not been effected in the accounts. The management has confirmed to the auditors that the conditions contained in the leasehold definitive agreement would be complied with and would not result in to any adverse impact on the financials of the Company or on the successful implementation of the SORA.
2(a). Interest liability relating to certain borrowings is being accounted for on payment basis. Had such liability been accounted for on accrual basis, the loss for the three months and six months ended September 30, 2007 would have been higher by Rs 1 lac and Rs 2 lacs respectively and the debit balance in profit and loss account would have been higher by Rs 231 lacs (Refer to note 1).
(b) Various matters arising / arisen out of reorganisation will be settled and accounted for as and when the liabilities / benefits are finally determined as stated in note 1. The effect of these on the financial results for the three months and for the six months ended September 30, 2007 is not ascertainable at this stage.
India Foils Ltd has informed that in the limited review report of the Company for the quarter ended September 30, 2007, the Auditors of the Company have made the following observations:
1. As indicated in Note 2(a) on the Unaudited Financial Results, the Company has neither ascertained nor provided for impairment loss, if any, in the carrying amount of certain fixed assets lying at its Taratala and Hoera units, the operations of which are under suspension since April 2002 and September 2003 respectively, aggregating Rs 6461.61 lacs (net of depreciation) as on March 31, 2007 [balances as on September 30, 2007 being Rs 6068.57 lacs (net of depreciation)] as may be required to comply with the Accounting Standard 28 on Impairment of Assets issued by The Institute of Chartered Accountants of India.
2. As indicated in Note 2(b) on the Unaudited Financial Results, the Auditors are unable to comment on the appropriateness of preparation of the Unaudited Financial Results on a Going Concern Basis in view of losses and erosion of net worth and the Company having been declared a sick industrial Company by the Board for Industrial and Financial Reconstruction in terms of Section 3(1)(o) of the Sick Industrial Companies (Special Provisions) Act, 1985 vide its order dated May 09, 2006.
3. As indicated in Note 2(c) on the Unaudited Financial Results, in respect of the Hoera unit, the operation of which is under suspension since September 15, 2003, the Company has neither ascertained not provided for any liability towards (i) Provident Fund, Employees State Insurance Scheme, Leave liability and Gratuity & (ii) Salaries & Wages from the aforesaid date of suspension to September 30, 2007.
In view of the above, the Auditors are unable to comment on the compliance of the requirements of Accounting Standard 29 on Provision, Contingent Liabilities and Contingent Assets issued by the Institute of Chartered Accountants of India.
Jenson & Nicholson India Ltd has informed that in the limited review report of the Company for the quarter ended September 30, 2007, the Auditors of the Company have made the following observations:
1(i) The banks, financial institutions and other lenders have filed legal cases against, the Company for recovery of outstanding loans and interest thereon. No provisions, has been made in these accounts for additional interest, penal interest, liquidated damages etc., amounting to Rs 739.67 lacs as claimed by the above lenders at various legal forums and the same has been considered as contingent liability. The Company however has provided interest on the above loans on a basis as considered appropriate by the management but up to March 31, 2006. The Company has stopped providing interest on all loans from banks and financial institutions whether secured or unsecured w.e.f. April 01, 2006 on the ground that these loans would have been declared NPA by them. Interest amounting to Rs 10889.11 lacs for the period from April 01, 2006 to September 30, 2007 has not been provided but the same has also been considered as contingent liability. For the six months ended September 30, 2007 the interest amounts to Rs 3993.73 lacs.
1(ii) In the absence of adequate details and information and explanation, the auditors are unable to comment as to the extent of recoverability of loans and, advances and Sundry Debtors as on September 30, 2007.
1(iii) In the absence of documentary evidence and confirmations, amount of interest payable to the suppliers in the form of Micro, Small & Medium Enterprises and others under the provision of the Micro, Small and Medium Enterprises Development Act, 2006 count not be ascertained.
Bank of Maharashtra has informed that in the limited review report of the Bank for the quarter ended September 30, 2007, the Auditors of the Bank have made the following observations:
These review reports cover 53.37% of the advances portfolio of the bank. Apart from these review reports, in the conduct of our review, Company have also relied upon various returns received from branches of the bank.
Based on Auditors review, as aforesaid and subject to the following:
a. Effect on the accounts; of balancing in subsidiary ledgers in respect of certain accounts like deposits, advances, suspense, sundry suspense, clearing differences, other assets / liabilities etc. with General Ledger which is incomplete in a few branches / offices and inter branch accounts and inter branch transfer of fixed assets entries under reconciliation pending to be passed, is not ascertainable;
b. Capital adequacy ratio, as worked out by the Bank based on data compiled by them and earning per share are subject to the effect of observations in Para (a) above and
c. The Bank has made provision for employees benefit for half year ended September 30, 2007 on estimate basis. However effect, if any, of Revised Accounting Standard 15 issued by ICAI on retirement benefit of the employees is yet to be ascertained.
Panacea Biotec Ltd has informed that in the limited review report of the Company for the quarter ended September 30, 2007, the auditors of the Company have made the following observations:
1. Redemption of outstanding amount of US $ 44,800,000 out of USD 50 Million Zero Coupon Convertible Bonds due 2011 is due on February 14, 2011. Unless these Bonds have been previously converted, redeemed, repurchased and cancelled, Company will redeem these Bonds at a Price equal to 142.80% of the outstanding principal amount on the maturity date. Since the redemption of bonds is contingent upon its non-conversion into Equity Shares, the Company has not provided for the proportionate premium on redemption for the period upto March 31, 2007 amounting to Rs 159,623,752. The same was disclosed as a matter of emphasis in the Audited Annual Accounts as in the opinion of the management likelihood of redemption cannot presently be ascertained and the same was disclosed as a contingent liability. Similarly, proportionate premium on redemption of Rs 36,195,500 and Rs 71,319.500 for the three months and six months ending September 30, 2007 respectively, has not been provided for.
2. Annual audited accounts contained a matter of emphasis regarding capitalization of expenditure on clinical trials amounting to Rs 91,557,518 since the ultimate approval of such products, which has been considered as highly likely by the management, was not within the direct control of the entity. Likewise expenses of similar nature amounting to Rs 45,883,751 and Rs 87,640,586 for three months and six months ending September 30, 2007 respectively have been capitalized in the books on similar grounds.
HTMT Global Solutions Ltd has announced the following Audited Results for the quarter ended September 30, 2007:The Company has posted a net profit after tax of Rs 148.447 million for the quarter ended September 30, 2007 where as the same was at Rs 0.051 million for the quarter ended September 30, 2006. Total Income is Rs 904.220 million for the quarter ended September 30, 2007 where as the same was at Rs 0.053 million for the quarter ended September 30, 2006.The figures for the quarter ended September 30, 2006 are Unaudited.The Unaudited Consolidated Results are as follows:The Group has posted a profit after minority interest of Rs 220.771 million for the quarter ended September 30, 2007. Total Income is Rs 1638.634 million for the quarter ended September 30, 2007.Pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT / ITES business between the Company, Hinduja TMT Ltd and their respective shareholders and creditors and reduction of capital (the Scheme) as sanctioned by the Honble High Court of Judicature at Bombay on February 23, 2007 and made effective on March 07, 2007, the assets and liabilities (including capital commitments and contingent liabilities) pertaining to IT / ITES business of Hinduja TMT Ltd were transferred to and vested in the Company w.e.f. October 01, 2006 (being appointed date) at their book values as specified in the Scheme. Pursuant to the Scheme a Shareholder holding two Equity Shares of Rs 10 each in Hinduja TMT Ltd on a record date i.e. April 09, 2007 was allotted one Equity Shares of Rs 10 each in the Company. Accordingly, the Company has allotted 20,538,003 Equity shares of Rs 10 each on April 10, 2007 to such eligible shareholders. Further in accordance with the Scheme, 250,000 Equity Shares of Rs 10 each held by Hinduja TMT Ltd and its nominees have been cancelled on allotment of the Equity Shares. On cancellation of such equity has been carried to General Reserve. The Equity Shares of the Company were listed with BSE / NSE w.e.f. June 19, 2007.
