Spice Mobility - Spice Global

2424
Annexure referred to in paragraph 3 of our report of even date
Re: Spice Mobiles Limited (‘the Company’)
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fi xed
assets.
(b) Fixed assets have been physically verifi ed by the management during the year and no material discrepancies were identifi ed
on such verifi cation.
(c) There was no substantial disposal of fi xed assets during the year.
(ii) (a) The management has conducted physical verifi cation of inventory at reasonable intervals during the year.
(b) The procedures of physical verifi cation of inventory followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical
verifi cation.
(iii) (a) The Company has granted loan to one director covered in the register maintained under Section 301 of the Companies Act,
1956. The maximum amount outstanding during the year and the year-end balance of the loan was Rs.10,000,000.
(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and
conditions for the loan are not prima facie prejudicial to the interest of the Company.
(c) The loan granted is re-payable on demand. As informed, the Company has not demanded repayment of the loan during the
year, thus, there has been no default on the part of the director to whom the money has been lent. The payment of interest
has been regular.
(d) There is no overdue amount of the loan granted to the director of the Company.
(e) As informed, the Company has not taken any loans, secured or unsecured from companies, fi rms or other parties covered in
the register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4(iii) (e), (f) and
(g) of the Companies (Auditor’s Report) Order, 2003 (as amended) are not applicable to the Company.
(iv) Purchase of components for manufacturing passbook printers and mobile handsets and the major portion of the traded goods
including mobile handsets are stated to be of proprietary nature, and hence, in such cases, the comparison of prices with
the market rates or with purchases with other parties cannot be made. Read with the above, in our opinion and according to
the information and explanations given to us, there is an adequate internal control system commensurate with the size of the
Company and the nature of its business for the purchase of inventory and fi xed assets and for the sale of goods and services.
During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.
During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system
of the Company.
(v) (a) According to the information and explanations provided by the management, we are of the opinion that the particulars of
contracts or arrangements referred to in Section 301 of the Act that need to be entered into the register maintained under
Section 301 have been so entered.
(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such
contracts or arrangements exceeding value of Rupees fi ve lakhs have been entered into during the fi nancial year at prices
which are reasonable having regard to the prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central
Government for the maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956, and are of the opinion
that prima facie, the prescribed accounts and records have been made and maintained.
(ix) (a) Undisputed statutory dues including provident fund, investor education and protection fund, or employees’ state insurance,
income-tax, sales-tax, wealth-tax, service tax, customs duty and excise duty have generally been regularly deposited with
the appropriate authorities though there has been a slight delay in a few cases.
Further, since the Central Government has till date not prescribed the amount of cess payable under Section 441 A of the
Companies Act, 1956, we are not in a position to comment upon the regularity or otherwise of the Company in depositing
the same.
(b) According to the information and explanations given to us, no undisputed dues in respect of provident fund, investor
education and protection fund, employees’ state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty,
excise duty, cess and other statutory dues were outstanding at the year end for a period of more than six months from the
date they became payable.