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.
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