MODEL COST AUDIT REPORT

ANNEXURE TO COST AUDIT REPORT RULES, 2011

CAMAP INTER ACTIVE WORKSHOP on 22nd FEB 2012

PRESENTATION BY Y R DOSHI AND ASSOCIATES COST ACCOUNTANTS MUMBAI yrdassociates@gmail.com

ANNEXURE TO THE COST AUDIT REPORT [See rule 2 and rule 6] CHAPTER - 1 GENERAL INFORMATION 1 CIN or GLN of the company: L12345MH1234BLCO55578 Name of the company: Rajkumar Paper Mills Limited Registered office address: Chinchwad, Pune 411 039. Corporate office address: R.S.Gandhi Marg, Fort, Mumbai 400080 E-mail address of the company: rk@rajkumar.com Company's financial year to which the Cost Audit Report relates: 1st April 2011 to 31st March 2012 Name, address, membership number and e-mail of the Cost Auditor's): M/S X Y Z & Co. Mr.X M. NO. 10000 Mr.Y M. NO. 20000 Mr.Z M. NO. 30000 J. B. Nagar, Borivli , Mumbai 400 092. E-Mail : xyzco123@yahoo.com 8 SRN Number and date of Filing of Form 23C with the Central Government: A63826384 Date of Board of Directors' meeting wherein the Annexure to the cost audit report were approved: Annexure to cost audit report were approved by the Board of Director in meeting held on __ _ __ _ _,2012. No. of Audit Committee meetings held by the company, and attended by the Cost Auditor during the year under review. The Company held _ _ Audit committee meetings and _ _ meetings were attended by Cost Auditors during the year under review.

10

CHAPTER - 2 COST ACCOUNTING POLICY 1 Briefly describe the cost accounting policy adopted by the Company keeping in view the requirements of the Companies (cost Accounting Records) Rules, 2011, the Companies (Cost Audit Report) Rules, 2011, cost accounting standards and its adequacy or other wise to determine correctly the cost of production / operation, cost of sales, sales realization and margin of the product / activity groups under reference separately for each product / activity group. The policy should cover, inter alia, the following areas: Cost accounting policy adopted by the company for the following areas are as under: Basics of Costing Policy 1.01 The company follows the historical process cost convention on accrual basis of accounting in accordance with the Generally Accepted Cost Accounting Principle (GACAP) and Cost Accounting Standards keeping in view the requirements of the Companies (Cost Accounting Records) Rules, 2011, the Companies (Cost Audit Report) Rules, 2011, 1.02 The preparation of cost statements requires that the management of company makes reasonable estimates and assumptions that affects the allocation / apportionment and absorption of expenses recognized in the period to determine correctly the cost of production / operation, cost of sales realization and margin of the product / activity groups separately of the unit / plant. Identification of cost centers/cost objects and cost drivers: The company emphasis on direct identification of expenses with product / plant and common expenses as classified overheads as under: Plant Cost Centers and Cost Objects Waste Paper Plant Stock preparation & Paper Machine No 1 Stock preparation & Paper Machine No 2 Rewinder Super Calenders Slitting Cutting Finishing and Packing. Common Utilities and Services Pump House for water treatment Boiler House for steam generation Power House for distribution of electricity Effluents treatment plant Strategy Plant Maintenance (Work shop) Factory O/h including Administration Administration and Corporate O/h Selling & Distribution O/h Water Utilization (KL) Steam Utilization (MT) Power Utilization (KWH) Treated Water (KL) Estimated % of Utilization Purpose & Nature of expenses Purpose & Nature of expenses Purpose & Nature of expenses Cost Drivers Production in Tonnage Machine Hour Utilization / Available Machine Hour Utilization / Available Machine Hour Utilization / Available Machine Hour Utilization / Available Machine Hour Utilization / Available Machine Hour Utilization / Available Tonnage

1.00

1.03

Accounting for material cost including packing materials, stores and spares etc., employee cost, utilities and other relevant cost components. 1.10 1.11 Material and Stores Accounting : Material Cost Indegenous materials and stores receipt are valued at landed cost inclusive of all expenses incurred for the procurement of the materials but net off VAT/CENVAT subject to set off. Imported material are accounted at the custom exchange rates prevailing at the time of receipts an includes all incidental expenses like, insurance, freight, import duty, clearing charges, etc. The Stores' issue is booked at moving weighted average rate / FIFO. Normal shortages/excesses observed during physical stock verification are periodically adjusted in consumption of respective materials. 1.12 Packing Material Packing material used for packing of reels and reams are identified on the basis of packing recipe & charged to product. Secondary packing like palatisation, etc.is considered as dispatching cost . Consumption of wrapping paper manufactured and consumed as packing material is transferred and valued at COP during the year. 1.13 Stores & Spares Consumable Stores and spares are identified with consumption cost centre. Machinery spares issues are treated as repairs to Plant & machinery. Employees Cost Employee Records are maintained Cost center wise for direct allocation of employee cost. Employee cost includes benefits payable available such as over time, incentives, payment & provision for leave salary, Company's contribution to Provident / Pension Fund and Employees State Insurance, linked insurance, Provision for bonus & Gratuity, etc. The engagement of contractor's labour for certain specific jobs/operations are identified and allocated as direct labour cost. The Common labour payment is considered as either Works Overhead or Administration overhaed as per the nature of Utilities : The cost of each utilities like power, raw water, treated water, steam, Power generation plant, Cooling water and ETP is worked out for each of the above cost centres. The utilisation of utilities allocation / apportionment are done on the basis of monthly utilisation of these facilities by recipient plants on technical basis and are reconciled. Repairs & Maintenance Machinery spares and repairs job labour bills are identified with respective plant and machinery. Repairs to building is apportioned on the basis of area and other repairs are considered as plant overheads or administration overheads. 1.40 1.41 Accounting, allocation/apportionment and absorption of overheads Expenses are identified with cost center / activity / product as far as possible. In case where it is not possible to identify directly, the same is considered as production / administration / selling and other overheads based on nature & purpose of expenses in the inbuilt system of Financial Accounting on the basiss of Generally Accepted Cost Accounting Principles.

1.20 1.21

1.22

1.30

1.31

1.42

Absorption (into product cost) Factory Overheads The total conversion cost of the production departments including factory administration overheads are then divided by the Machine Hours worked during the year to obtain Machine Hour Rate for each production department. The actual time taken for each lot are recorded in the Departmental log books from where total time worked during the year for producing each variety of paper is ascertained. This cumulated time multiplied by the Departmental Machine Hour Rate gives the total conversion cost for each variety of paper produced. Whereas, finishing and packing department expenses are absorbed on the basis of tonnage packed in reels and reams. Corporate Administrative Overheads The Corporate administrative overheads are absorbed directly into the variety of paper on the basis of sales realization of paper sold. Selling and Distribution Overheads The element wise selling and distribution overheads are absorbed either on the basis of quantity sold or the net sales realization depending upon nature of expense. Commission on Sales is identified with each type of paper. Cost of the samples is ascertained separately & considered as Selling & Distribution expenses.

1.50

Accounting for Depreciation/Amortization Depreciation on machinery & building has been provided on straight line method and on the other assets on written down value method in accordance with Schedule XIV of the Companies Act,1956 as in force as on the date of Balance sheet. Depreciation on all assets is in the first instance departmentalized, based on the locations of the assets. Depreciation on Buildings is apportioned on the basis of area occupied by each cost centers. Depreciation on Machinery is allocated on the basis of identification. Depreciation on furniture, office equipments and fixtures, vehicles etc. is considered as overheads depending upon location and usage. Accounting for by-products/joint-products, scarps, wastage etc. There are no by-products or joint products generated while manufacture of paper. Broke is waste generated while finishing of paper which is reused as pulp. Broke is valued at average cost of waste paper purchased since the sales realization of Broke is not feasible and quality of broke resembles waste paper.The scrap generated due to sale of empty drums, MS scrap, etc. is analysed and credited on approrpiate basis. Basis for Inventory Valuation Raw material, Packing material, Stores & Spares are valued at landed cost on moving weighted average / FIFO method. Semi finished and Finished goods is valued at variety / gram age wise cost of production according to the stage of completion and location where stored excluding any taxes and duties. Methodology for valuation of Inter-Unit/Company and Related Party transactions Direct Cost of job work processing of Pulp and Steam plus share of fixed overheads allocated / apportioned and absorption on the basis of normal capacity utilization and reasonable profit margin. Raw material at landed cost of purchases at relevant time and sale of finished goods at comparable price on arms length basis. Share of common utilities and services in respect of security, communication, Quality Control, Space utilization, etc. on the appropriate cost basis considering common cost of salaries, direct allocated expenses, etc. for each type of services. Interest received is on account on loan given is charged at the prevailing bank rate.

1.60

1.70 1.71 1.73

1.74

1.75

Treatment of abnormal and non-recurring costs including classification of other non-cost items. In case of significant under utilization normal conversion cost per production is considered for absorption of labour & overheads. Non cost / Non recurring income and expenses such as Provision for obsolete items, Loss on Sale of Fixed Assets, Donations, Provision of doubtful Debts and Bad Debts written off, etc. and Other Income such as Exchange diff, interest / Dividend on Investments, etc.

1.80 1.81 1.82 1.83 1.84

Other relevant cost accounting policy adopted by the Company Treatment of Foreign exchange gain/(Loss) on Plant & Machinery, imported material, sales of FG, etc. Company Social responsibility Treatment of expenditure during construction period. Financial Cost Interest on term loans, premium on redemption of Debenture/Debts, interest on working capital. Revenue sales recognition Domestic Realisation Export realisation Export benefits Central excise duty and service tax. Briefly specify the changes, if any, made in the cost accounting policy for the product / activity group(s) under audit during the current financial year as compared to the previous financial year. Change in Method of WIP & Finished goods Inventory valuation, Identification of overheads, etc.

1.90 1.91 1.92 1.93 1.94 2)

3)

Observations of the Cost Auditor regarding adequacy or otherwise of the Budgetary Control System, if any, followed by the company.

4)

In case the Company has adopted IFRS, variations (if any) in treatment of cost accounting arising out of adoption of IFRS in Financial Accounting. Not Applicable.

CHAPTER - 3 PRODUCT GROUP DETAILS (for the company as a whole)

Sr. Name of each Product Group no.

Names of Net Sales (net of taxes, Products/ duties, etc.) (Rs. Lakh) Activities included in the Product Group 2011-12 2010-11

Covered under Cost Audit

(Yes/No)

A Manufactured Product Groups 1 White Printing Paper 2 Tissue Paper 3 4 etc. Sub-Total (A) B Services Groups 1 2 3 4 Sub-Total (B) C Trading Activities (Product Group-wise) 1 2 3 4 etc. Sub-Total (C) D Other Incomes 1 Dividend, Interest 2 Profit on Sales of Fixed Assets 3 Misc., Scrap Sales, etc. Sub-Total (D) E Total Income as per Audited Annual Report (A+B+C+D) Maplitho, M.G. Poster, etc. Sanitary Tissues 3507.98 4016.01 Yes Yes

7523.98

12.57 2.07 5.20 19.84 7543.82

Increase / Decrease in turnover is due to . NOTES: 1) For manufactured product groups, use the nomenclature as used in the Central Excise Act and Rules, as applicable. 2) For service groups, use the nomenclature as used in the Finance Act / Central Service Tax Rules, as applicable.

CHAPTER - 4 (A) QUANTITATIVE INFORMATION Name of the Company : Name of the Product Group : Name of the Products covered in the Product Group : Paper Financial Year S.N. Particulars 1. Available Capacity (a) Installed Capacity (b) Capacity enhanced during the year, if any (c) Capacity available through leasing arrangements, if (d) Capacity available through loan license / third parties (e) Total available Capacity 2. Actual Production (a) Self manufactured (b) Produced under leasing arrangements (c) Produced on loan license / by third parties on job work (d) Total Production 3. Production as per Excise Records 4. Capacity Utilization (in-house) 5. Stock Purchased for Trading (a) Domestic Purchase (b) Imports (c) Total Purchases 6. Stock & Other Adjustments (a) Change in Stock of Finished Goods (b) Self / Captive Consumption (incl. samples etc.) (c) Other Quantitative Adjustments, if any (wastage etc.) (d) Total Adjustments 7. Total Available Quantity for Sale [2(d) + 5(c) - 6(d)] 8. Actual Sales (a) Domestic Sales (manufacturing) (b) Domestic Sales (trading) (c) Export Sale (manufacturing) (d) Export Sale (trading) (f) Total Quantity Sold Notes : The variation in the utilisation of installed capacity is due to change in the product mix which is dependent upon demand of various types and grammage of paper and on account of loss due to set up time for the lot change from time to time. Rajkumar Paper Mills Limited White Printing Paper (Qty. in MT) 2011-12 2010-11 Cur. Year Prev. Year 9000 9,000 0 9,000 9,000 8086

8086 8086 90

0 0 -40 0 0 -40 8046 8046

8046

CHAPTER - 4 (B) QUANTITATIVE INFORMATION Name of the Company : Rajkumar Paper Mills Limited Name of the Product Group : Tissue Paper Name of the Products covered in the Product Group : Paper (Qty. in MT) Financial Year 2011-12 2010-11 Sr.no. Particulars Cur. Year Prev. Year 1. Available Capacity 10,000 10,000 (a) Installed Capacity (b) Capacity enhanced during the year, if any (c) Capacity available through leasing arrangements, if (d) Capacity available through loan license / third parties (e) Total available Capacity 10,000 10,000 2. Actual Production 8865 (a) Self manufactured (b) Produced under leasing arrangements (c) Produced on loan license / by third parties on job work (d) Total Production 8865 8865 3. Production as per Excise Records 89 4. Capacity Utilization (in-house) 5. Stock Purchased for Trading (a) Domestic Purchase (b) Imports (c) Total Purchases 6. Stock & Other Adjustments -124 (a) Change in Stock of Finished Goods (b) Self / Captive Consumption (incl. samples etc.) (c) Other Quantitative Adjustments, if any (wastage etc.) (d) Total Adjustments -124 8741 7. Total Available Quantity for Sale [2(d) + 5(c) - 6(d)] 8. Actual Sales 8726 (a) Domestic Sales (manufacturing) (b) Domestic Sales (trading) 15 (c) Export Sale (manufacturing) Export Sale (trading) (e) 8741 (f) Total Quantity Sold Notes: The variation in the utilisation of installed capacity is due to change in the product mix which is dependent upon demand of various types and grammage of paper and on account of loss due to set up time for the lot change from time to time.

CHAPTER - 5 ABRIDGED COST STATEMENT (for product group - Paper) Tissue Paper Sr.no. Particulars Units Quantity Rate Amount In Rupees Cost Rate per Unit 2010-11 2009-10

NOTES 1

2 3 4

1 Materials Consumed a) Imported (MT) 2193 26063 57156758 6471 3859 b) Indigenous Purchased (MT) 1755 22897 40193234 4551 3424 c) Self Manufactured / Produced (MT) 6927 23915 165666176 18757 18681 Total (a to c) 10876 263016168 29779 25964 2 Process Materials/Chemicals a) Sizing & Loading Materials 156707 5085646 576 696 b) Dyes & other chemicals 25564 9388018 1063 1079 Total (a to b) 14473664 1639 1775 3 Utilities Power (KWH) 9638311 5 48384321 5478 5529 Steam (MT) 37017 961 35581481 4029 3647 Water (KL) 513454 5 2310543 262 215 E.T.P. 1017957 115 64 4 Direct Employees Cost 10362714 1173 1077 5 Direct Expenses 960035 109 20 6 Consumable Stores & Spares 6153481 697 681 7 Repairs & Maintenance 2347438 266 154 8 Quality control 9 Research & Development Exps 237437 27 16 10 Technical know-how Fee / Royalty, if any 11 Depreciation/Amortization 3928990 445 586 12 Other Production Overheads 4526362 512 548 13 Total (1 to 12) 398361209 45103 40704 14 Add/Less: Work-in-Progress Adjustments 32 1259649 15 Less: Credits for Recoveries, BROKE -11191839 16 Primary Packing Cost 811 6500614 733 17 Cost of Production/Operations (13 + 14 to 16) 8865 394929633 44549 39197 18 Increase/Decrease in Stock of Finished Goods -1400 -124 -9422853 19 Less: Self/Captive Consumption (incl. Samples, etc.) 20 Other Adjustments (if any) 21 COP of Goods/Services Sold (17 + 18 to 20) 8741 385506780 44102 38986 22 Administrative Overheads 5060618 573 428 23 Secondary Packing Cost 24 Selling & Distribution Overheads 8287341 948 902 25 Interest & Financing Charges 2428609 278 220 26 Cost of Sales (21 + 22 to 25) 8741 396222730 45328 40916 27 Net Sales Realization (Net of Taxes & Duties) 8741 401600823 45943 41710 28 Margin [P/(L) as per Cost Accounts] (27 - 26) 8741 5378093 615 794 There is no significance variance since increase in cost is conpensated by increase in sales realisation Separate cost statement shall be prepared for each product/activity group The items of cost shown in the Proforma are indicative and the same should be reflected keeping in mind the materiality of the item of cost in the product/activity group. The Proforma may be suitably modified to meet the requirement of the industry/product/activity group. In case the company follows a pre-determined or standard costing system, the above cost statement should reflect figures at actuals after adjustment of variances, if any.

CHAPTER - 5 ABRIDGED COST STATEMENT (for product group - Paper) White Printing Paper Sr.no. Particulars Units Quantity Rate Amount

In Rupees Cost Rate per Unit 2010-11 2009-10

NOTES 1

2 3 4

1 Materials Consumed a) Imported (MT) 2873 26802 76992685 9557 3768 b) Indigenous Purchased (MT) 2228 c) Self Manufactured / Produced (MT) 6639 24309 161398272 20034 18955 Total (a to c) 9512 238390957 29591 24951 2 Process Materials/Chemicals a) Sizing & Loading Materials 526332 10994790 1365 1307 b) Dyes & other chemicals 47211 13181430 1636 1393 Total (a to b) 24176220 3001 2700 3 Utilities Power (KWH) 5548908 5 27855518 3458 3848 Steam (MT) 21182 961 20360626 2527 2431 Water (KL) 324531 5 1460390 181 151 E.T.P. 643407 80 45 4 Direct Employees Cost 6273267 779 750 5 Direct Expenses(cutting & Reeling chgs) 2672679 332 337 6 Consumable Stores & Spares 2351715 292 338 7 Repairs & Maintenance 1300530 161 96 8 Quality control 9 Research & Development Exps 210618 26 15 10 Technical know-how Fee / Royalty, if any 11 Depreciation/Amortization 3378804 419 591 12 Other Production Overheads 3067995 381 419 13 Total (1 to 12) 336416430 41759 37062 14 Add/Less: Work-in-Progress Adjustments 23 1590414 15 Less: Credits for Recoveries, BROKE 431 -6203652 16 Primary Packing Cost 1025 6177045 767 17 Cost of Production/Operations (13 + 14 to 16) 8086 337980237 41798 37475 18 Increase/Decrease in Stock of Finished Goods -1400 -40 -4225392 19 Less: Self/Captive Consumption (incl. Samples, etc.) 20 Other Adjustments (if any) 21 COP of Goods/Services Sold (17 + 18 to 20) 8046 333754845 41479 37471 22 Administrative Overheads 4273704 530 390 23 Secondary Packing Cost 24 Selling & Distribution Overheads 6769785 841 770 25 Interest & Financing Charges 2100081 261 205 26 Cost of Sales (21 + 22 to 25) 8046 342624711 42581 39036 27 Net Sales Realization (Net of Taxes & Duties) 8046 350797659 43597 37257 28 Margin [P/(L) as per Cost Accounts] (27 - 26) 8046 8172948 1016 -779 Increase in margin is due to increase in sales realisation Separate cost statement shall be prepared for each product/activity group The items of cost shown in the Proforma are indicative and the same should be reflected keeping in mind the materiality of the item of cost in the product/activity group. The Proforma may be suitably modified to meet the requirement of the industry/product/activity group. In case the company follows a pre-determined or standard costing system, the above cost statement should reflect figures at actuals after adjustment of variances, if any.

CHAPTER - 6 OPERATING RATIO ANALYSIS (for each product group separately) Tissue Paper Sr. Particulars Units 2011-12 2010-11 no. Ratio of Operating Expenses to Cost of Sales 1 Materials (incl. Process Materials) Cost 2 Utilities Cost 3 Direct Employees Cost 4 Direct Expenses 5 Consumable Stores & Spares 6 Repairs & Maintenance Cost 7 Depreciation / Amortization Cost 8 Packing Cost 9 Other Expenses 10 Stock Adjustments 11 Production Overheads 12 Administrative Overheads 13 Selling & Distribution Overheads 14 Interest & Financing Charges 15 Total

2009-10

% % % % % % % % % % % % % % %

67.21 22.03 2.62 0.24 1.55 0.01 0.99 1.64 0.06 (1.47) 1.14 1.28 2.09 0.61 100.00

67.79 23.11 2.63 0.05 1.66 0.38 1.43 1.98 0.04 (4.20) 1.34 1.05 2.20 0.54 100.00

Note: There are no significance variance in operating ratio

CHAPTER - 6 OPERATING RATIO ANALYSIS (for each product group separately) White Printing Paper Sr. Particulars Units 2011-12 2010-11 no. Ratio of Operating Expenses to Cost of Sales 1 Materials (incl. Process Materials) Cost 2 Utilities Cost 3 Direct Employees Cost 4 Direct Expenses 5 Consumable Stores & Spares 6 Repairs & Maintenance Cost 7 Depreciation / Amortization Cost 8 Packing Cost 9 Other Expenses 10 Stock Adjustments 11 Production Overheads 12 Administrative Overheads 13 Selling & Distribution Overheads 14 Interest & Financing Charges 15 Total

2009-10

% % % % % % % % % % % % % % %

73.08 14.34 1.79 0.76 0.67 0.37 0.96 1.76 0.06 1.58 0.87 1.22 1.93 0.60 100.00

74.22 17.38 2.01 0.90 0.91 0.26 1.59 2.75 0.04 (4.85) 1.12 1.05 2.07 0.55 100.00

Note: There are no significance variance in operating ratio

CHAPTER - 7 PROFIT RECONCILIATION (for the company as a whole) Sr. no. 1 a) b) 2 a) b) c) 3 Particulars Profit or Loss as per Cost Accounting Records For the audited product groups For the un-audited product groups Add: Incomes not considered in cost accounts: Profit on sale of Fixed Assets Dividend Received Cr.Balance write off 2011-12 2010-11 Rs. In lakhs 2009-10

135.51 2.07 12.57 150.15

209.57

8.19 217.76 2.00 5.78 1.15 8.93

Less: Expenses not considered in cost accounts: a) Donations b) Doubtful debts c) Loss on sale of Fixed Assets Add: Overvaluation of closing stock in financial accounts Add: Undervaluation of opening stock in financial accounts Less: Undervaluation of closing stock in financial accounts Less:: Overvaluation of opening stock in financial accounts Adjustments for others, if any (specify) Profit as per cost accounts for other activities

5.00 10.15 15.15

4 5 6 7 8 a) b) 9

11.69 19.11

11.69 16.35

10 Profit or Loss before tax as per Financial Accounts

127.58

180.79

CHAPTER - 8 VALUE ADDITION AND DISTRIBUTION OF EARNINGS (for the company as a whole) Sr. Particulars no. A 1 2 3 4 5 6 a) b) c) d) e) 7 8 9 B 1 2 3 4 5 Value Addition: Gross Sales (excluding returns) Less : Excise duty etc. Net sales Add: Export Incentives Add/Less: Adjustment in Finished Stocks Less: Cost of bought out inputs Cost of Materials Consumed Process Materials / Chemicals Consumption of Stores & Spares Utilities (e.g. power & fuel) Others, if any Total Cost of bought out inputs Value added Add : Income from any other activities Earnings available for distribution Distribution of Earnings to: Employees as salaries & wages, retirement benefits, etc. Shareholders as dividend Company as retained funds Government as taxes (Tax on Income) Others, if any (Depreciation and Interest) Total distribution of earnings 2011-12 2010-11 Rs. In Lakhs 2009-10

8276.38 752.40 7523.98 107.98 4840.12 386.50 85.05 1376.14 523.92 7211.73 420.23 14.64 434.87 166.36 82.00 23.42 44.72 118.36 434.87

7299.10 663.56 6635.55 52.22 4047.11 372.78 87.67 1359.13 500.68 6367.37 320.40 8.19 328.59 155.71 41.00 63.49 4.95 63.44 328.59

CHAPTER - 9 FINANCIAL POSITION AND RATIO ANALYSIS (for the company as a whole) No . A 1 2 3 4 Particulars Units 2011-12 2010-11 Rs. In Lakhs 2009-10

Notes:

Financial Position Paid-up Capital Rs/Lakh 820.00 Reserves & Surplus Rs/Lakh 10370.29 Loans (secured & unsecured) Rs/Lakh 4499.57 (a) Gross Fixed Assets Rs/Lakh 24546.97 (b) Net Fixed Assets Rs/Lakh 9528.94 Rs/Lakh 13521.72 5 (a) Total Current Assets (b) Less: Current Liabilities & Provisions Rs/Lakh 5786.80 (c) Net Current Assets Rs/Lakh 7734.92 Rs/Lakh 17263.86 6 Capital Employed Rs/Lakh 11190.29 7 Net Worth B. Financial Performance Rs/Lakh 7192.62 1 Cost of Production Rs/Lakh 7388.47 2 Cost of Sales Rs/Lakh 7523.98 3 Net Sales Rs/Lakh 420.23 4 Value Added Rs/Lakh 127.58 5 Profit before Tax (PBT) C. Profitability Ratios % 0.74 1 PBT to Capital Employed (B5/A7) % 1.14 2 PBT to Net Worth (B5/A8) % 1.70 3 PBT to Net Sales (B5/B3) % 30.36 4 PBT to Value Added (B5/B4) D. Other Financial Ratios % 40.21 1 Debt-Equity Ratio % 233.66 2 Current Assets to Current Liabilities % 5.59 3 Valued Added to Net Sales E. Working Capital Ratios Months 119.22 1 Net Working Capital to Cost of Sales excl. dep. Months 1.89 2 Raw Materials Stock to Consumption Months 12.12 3 Stores & Spares to Consumption Months 0.03 4 Work-in-Progress Stock to Cost of Production Months 0.77 5 Finished Goods Stock to Cost of Sales (1)Capital Employed means average of net fixed assets (excluding intangible assets, effect of revaluation of fixed capital w-i-p) plus net current assets existing at the beginning and close of the financial year.

820.00 11352.37 6822.54 24516.06 11082.05 13937.82 3885.96 10051.86 21133.91 12172.37 6365.00 6538.32 6420.56 320.40 180.79 0.86 1.49 2.82 56.43 56.05 358.67 4.99 153.74 1.62 12.77 0.04 0.73 assets, and

(2)Net Worth means share capital plus reserves and surplus (excluding revaluation reserves) less accumulated losses and intangible assets.

CHAPTER - 10 RELATED PARTY TRANSACTIONS (for the company as a whole) Name & Address Sr. of the no. Related Party Name of the Product / Nature of Quantity Transfer Service Group Transactio Price (Rs.) n (Sale, Purchase, etc.) Purchase Job Work 374 MT 51329 MT 25824 198 Amount (Rs. In Lakhs) Normal Price Basis adopted to determine the Normal Price

1 ABC P. Ltd Pulp 2 PVR & Co. Steam Processing

96.58 101.63

25000 At cost 200 Normal cost of processing + Profit Activity Service cost 40000 Comparable Sales

3 PVR & Co. Computer, Security, etc. Common Services PVR & Co. Wrapping Sales 4

30.68 12 MT 40200 4.82

NOTES: (1) Details should be furnished for each sale / purchase separately. (2) Details of Related Party transactions without indicating the Normal Price and the basis thereof shall be considered as incomplete information.

CHAPTER - 11 RECONCILIATION OF INDIRECT TAXES (for the company as a whole) Particulars Total Clearances Domestic Export Stock Transfers (Net) Others, if any Total Duties/Taxes Payable Duties/Taxes Paid Cenvat/VAT Credit Utilised - Inputs Cenvat/VAT Credit Utilised - Capital Goods Cenvat/VAT Credit Utilised - Input Services Cenvat/VAT Credit Utilised - Others Total Paid through PLA/Cash Total Duties/Taxes Paid Duties/Taxes Recovered Difference between Duties/Taxes Paid and Recovered Interest/Penalty/Fines Paid
Assessable Excise Duty Value

Service Tax Cess & Others

Rs. In Lakhs VAT

7523.98

752.40

22.57

331.06

10.00 7533.98

0.50 752.90 451.74 25.96 12.50 0.50 490.70 216.78 707.48 707.48 22.57 13.55 0.78 0.38 14.71 7.87 22.57 22.57 -

0.42 331.48 232.03 12.98 4.30 249.31 82.16 331.48 331.48 -

22.34 22.34

Signature Name Mr. X Cost Auditor (s) Membership No. (s) 10000 Seal Date Notes:

Signature Name CS/Director Mem./DIN No. Stamp Date

Signature Name Director DIN No. Stamp Date

(1)Wherever,thereis any significant variation in the current year's figure over the previous year's figure for any item shown under each para of the Annexure to the Cost Audit Report, reasons thereof shall be given by the Cost Auditor. (2)Wherever,duration of the current year or the previous year is not 12 (twelve) months, same shall be clearly indicated in the report.