INTERNAL AUDIT REPORT

Client Name: M/s Vineet Oils P. Ltd. Report Date: 19/12/2011 Period: 01st April to 30th Sept., 2011 Auditee: Mr. Vishal & Kushal Surekha Accountant: Mr. Kamal

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S. No. 1.

Audit Observation (Point; annexure) Co. is not maintaining any detailed information register for Fixed Assets amounting Rs. 70 Lacs. (Point 1.a)

2.

It seems deposit of almost Rs. 8.12 Lacs have given parties in Cash, instead of FDR.(Point 1.b;1)

Risk Criteria / Recommendation Risk: Very High Recommendation: i) Model Fixed Assets register format will be given, to extract and fill up the information. Efforts are needed to incorporate the same in routine accounting process. Risk: Moderate Recommendation: i) Options should be explored to convert the same in FDR format to save interest cost. Risk: High Recommendation: i) Communications need to be done to restart relationship with those parties to boost sales and assure recoverability option also. Risk :Moderate Recommendation: should be avoided Risk: Very High Recommendation: validity have been elapsed, efforts for re-issuance needs to be done. Risk: High Recommendation: i) Above practice bears revenue implication in form of interest and penalty, hence should be avoided. Risk: High Recommendation: Proper care needs to be taken, return may be revised to claim above revenue implication.

Management Action Plan

Management Action Plan:

3.

Debtors of Rs. 4.62 Cr. have not done transactions during the financial period. (1.c;2)

Management Action Plan:

4.

Cash Book: - Seven days of July month have negative cash balance cash, indicating there is unaccounted cash lying in the organization. Cheque in Hand: Cheque of Rs. 10.44 Lacs of M/s PRT petrochemicals P. Ltd. have not been realized by the Co. since April. TDS: a. TDS liability have not been paid during the period (Rs. 1.1 lacs) b. A case of non-deduction of TDS is also found in case of Dibakar Dutta.(2.1;3) Sales Tax: a. Liability amounting Rs. 28.36 has been paid late in the month of Oct. b. In case of Balmer Lawrie Co. Ltd, discount has been allowed after charging of VAT, causing revenue implication of Rs. 1.29 Lacs. c. In some cases, input have not been taken causing revenue implication of approx. Rs. 2,000/- (2.ii;4)

Management Action Plan:

Management Action Plan:

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Management Action Plan:

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S. No. 8.

Audit Observation (Point; annexure)

9. 10.

11.

Service Tax:a. Some cases were found where input of service tax have not been taken causing revenue implication of Approx. Rs. 35,000/(2.iii) Difference in Opening Balance:- Opening balances is not tallied with amount of Rs. 3287/- (2.c) Documentation: a. Almost 250 transactions amounting Rs. 40 Lacs have been found of improper documentation. (3.a,b,e; 7,8,11) b. In some case of Rs. 6.7 lacs voucher date is earlier than invoice date (3.d;11) c. 6 transaction have been booked with a amount different than management approved, causing revenue implication of Rs. 14,611/- (3.d;10) d. Some cases of improper classification or double booking were found, which needs to be checked (3.f,g;12,13) E- documentation: - some function of Tally like control function, e- Risk: High statutory compliance, e-library may be used to establish proper Recommendation: i) We may assist the accounting staff to establish harmony between soft and hard records. (4) the above function in accounting software.

Risk Criteria / Recommendation Risk: Very High Recommendation: i) Proper care need to be taken to avoid these transactions. Risk: Very High Recommendation: should be tallied Risk: very high Recommendation: i) SOP for proper documentation needs to be formed and followed.

Management Action Plan Management Action Plan:

Management Action Plan: Management Action Plan:

Management Action Plan:

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