Jain Studios - Limited Review for the quarter ended Dec 31, 2007
Jain Studios Ltd has informed BSE that in the limited review report of the Company for the quarter ended December 31, 2007, the Auditors of the Company have made the following observations:
“1(a). In respect of Non-provision against shortfall in recovery (amount unascertainable) against overdue and other debts amounting to Rs 1982.99 lacs and loans and advance amounting to Rs 308.64 lacs, as the same has been considered good and recoverable by the management and Auditor’s inability to comment on recoverability thereof.
1(b). In respect of Non confirmation / reconciliation and non availability of documents in
support and audit trail of balances of debtors, loans and advances, Sundry creditors and other current liabilities (including statutory dues), banks and income and expenditure accounted for during the quarter and contingent liabilities considered as ascertained by the management, consequential impact where of presently cannot be ascertained and the Auditor’s inability to comment on correctness and completeness.
1(c) In respect of Transfer of Provident Fund amount payable of Rs 25.52 Lacs [upto March 31, 2007: Rs 27.00 lacs (net)) ‘Social Security Fund A/c’, based on management perception and in respect of non payment of certain statutory dues and non-filing of certain statutory returns / forms w.r.t. Employees State Insurance, Provident Fund, Tax Deducted at Source, Service Tax, Custom Duty, Fringe benefit Tax and others, and accounting of penalty, interest, etc. (amount unascertainable) and the Auditors inability to comment thereon; and in respect of non-provision / payment of Service Tax and deduction of Tax at Source on certain provision / payments (amount unascertained).
1(d) In respect of recognition and carry over of deferred tax assts (net) amounting to Rs 554.53 lacs (net of deferred tax liability of Rs 259.68 lacs), based on management perception in respect of availability of sufficient taxable income in coming years against which such assets can be realized; in respect of MAT credit entitlement amounting to Rs 26.45 Lacs recognized and carried over based on management perception and the Auditors inability to comment thereon. Further, provision for taxation including deferred tax has not been made as stated in thy footnote no. 4 to accompanying financial results (impact unascertained).
1(e) In respect of management perception about recoverable amount of the fixed assets (Impairment of Assets: AS-28) of the Company being more than carrying amount and the Auditor’s inability to comment thereon.
2. In respect of Internal Control system which needs to be further strengthened to be made the same commensurate with the size of the Company and nature of its business”.
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