Ajara Urban Co-op Bank Ltd.

, Ajara Dist Kolhapur

Branch N.M. J !"# MA$%.

!tatutor& Audit $'port (or )h' *'ar +nd'd ,--.,-/..0

Ajit 1. $anad' 2 Co. Chart'r'd Accountants 3, %uru4ar 1'th, $anad' Ch'5b'rs, 1alac' !tr''t, !atara 6-7../ 1hon' 8--/-0/-/,/.-8 8--/-0/-/,6337 C'll 86//6...37 +5ail apranad'9r'di::5ail.co5

With reference to the continuation letter no.101.dated 24/3/2006 of The Commissioner & Registrar of Co-o erati!e "ocieties# $aharashtra "tate# %une# &e ha!e carried out statutor' audit of (ori!ali )ranch of the *+ra ,r)an Coo erati!e (an- .imited for the 'ear ended 31 st$arch# 2006 on the )asis of records & information ro!ided to us. We are enclosing here&ith the certified co ' of (alance "heet as on 31.03.2006 & %rofit and .oss *ccount for the 'ear ended as on that date of the )ranch. We re ort that/ #N)$ DUC)# N; 1. $r. (.0.",R*123 is the )ranch manager during the audit eriod. 2. $r. 4.*. 5hadam is the "'stem *dministrator. 3. 6ld "'stem is of $. 2. $ Thane since 1778. "'stem &as changed on 17th 0ul'# 1777 9 this s'stem &as )ought from *utosoft "'stems .imited. 4. (ranch )usiness is carried out in the rented remises at :# ;arar&ala )uilding# 1.$. 0oshi $arg# $um)ai 400 011 8. "taff "trength/ The )ranch has follo&ing staff at the end of $arch 2006. 1 Regional $anager 1 2 (ranch $anager 1 3 *dhi-ari 6fficer 1 4 6fficer 3 3 Cashier 4 4 Cler14 8 %eon 8 6 Watchman 1 ------------------------------------------------------------------30 -------------------------------------------------------------------

6. Rectification Re ort/ Com liance / Rectification re ort of "tatutor' audit of the )ranch for the <.=. 2004-08 has )een sent to head office on 17.0:.2008. >. Concurrent *udit/ The Concurrent *udit of the )ranch has )een conducted )' $/s ?otha&ade & .addha# Chartered *ccountants# 14-* "hreedhar "mriti# 6 osite 5e!-i 1agar# 3-sar Road# (ori!ali @WA $um)ai 400 103. Co ies of the Concurrent audit re orts are a!aila)le &ith the )ranch. Com liance re ort of $arch 2006 &as ending till the date of our audit. :. $eetings of (ranch Committee/ 5uring the 'ear 4:)ranch committee meetings &ere held to re!ie& o!erdue# reco!er'# sanctioning# and a ro!al of ad!ances. 1A$) A <ollo&ing are serious irregularities o)ser!ed )' us during the course of our audit/ -. Ad<anc's; a. Bt is o)ser!ed in man' cases that the )orro&ers &ho ha!e o!erdue osition or are li-el' to )e identified as 1%*# short close their loan accounts and the )an- immediatel' sanction and dis)urse fresh loan to the )orro&er of usuall' the same amount. These accounts do not sho& an' satisfactor' o erations and this modus o erandi is re eated e!er' 'ear. This indicates accommodation /understanding )et&een )an- and )orro&er so as to reduce )an- o!erdue and 1%*.

). Bn case of Machin'r& ='hicl' Loan >Auto $icksha4? it is o)ser!ed that in most of the cases )ills/ in!oices of the auto ric-sha&s are in the name of "ainath *uto *genc' and most of the Cuotations/)ills/in!oices for accessories are in the name of "ha-ti $otors or 2anesh $otors &hich do not )ear "r. 1o.# date# C"T/ ("T Reg. 1o etc.# insurance co!er is not com lete# rene&ed "imilarl' in res ect of "alar' 2uarantee .oans# .oans are ad!anced to (.$.C.# $.C.2.(. em lo'ees and to their o&n em lo'ees# &ho ta-e loan for 8 to > 'ears# 2uarantors for these loans are also the )orro&ers <orm 1o 16 is ta-en onl' of the 'ear of )orro&ings. These issues raise the dou)ts of the eDistence of their continuit' of ser!ice. 5uring the course of audit it &as o)ser!ed that the a)o!e loans are done through outside agents# &ho ta-e the res onsi)ilit' of documentation# follo& u for reco!er' etc. (ranch manager/officials are in some cases not e!en a&are of the )orro&er and com liance of documents. This is not a health' ractice and should )e discouraged and discontinued immediatel'. 5etail o)ser!ation on such accounts are re orted in %art C /. <'rdu' #nt'r'st $'s'r<' > #$?; *s er R(B directi!e# interest due on 1%* a/c &hich is not charged to )orro&erEs account should )e sho&n in the )alance sheet on lia)ilit' side as 6!erdue interest Reser!e and the asset side as Bnterest Recei!a)le account. Bn the current 'ear it is recorded in the (alance "heet as reCuired.

,. %uarantors;

<ollo&ing irregularities are consistentl' o)ser!ed# instances of &hich are mentioned in %art C of our re ort/ aA 2uarantor is also a )orro&er of the )an-. )A *n indi!idual has gi!en guarantee to more than one )orro&er. 6 8 Loan :ro5 5or' than on' bank Br'ach o: B&'-La4 No 6- >A?; Bt is o)ser!ed in fe& cases that mem)ers a!ailing loans from the )an- ha!e also ta-en loans from other Coo erati!e (an-s# "ocieties or 3m lo'ees "ociet'.

7 Linkin@ o: shar' holdin@ Br'ach o: B&'-La4s No 6/; Bt is o)ser!ed in fe& cases that the shares are not held in ro ortion to their )orro&ing. 1A$) B <ollo&ing are our comments on the financial the )ranch/ -. D+1 !#)!; The com arati!e anal'sis of de osits of the )ranch is as follo&s/ @Rs. Bn .acsA %articulars <.=.2008- <.=. Bncrease/ %ercentage 06 2004@5ecreaseA 08 Bnc/ @5ecA 53$*15 .B*(B.BTB3" "a!ing *ccounts Current -A-8.-0 18:3.34 -6,.-7 131.4 138.:2 11.>3 :.8: F :.7F osition of

*ccounts TB$3 .B*(B.BTB3" 5am 5u at *mrut ?um)h 6ther 5e osits T6T*.

863.6-

708.:6

42.88 144.44 8.71

4.>0F 12.47F 0.7:F

-,...8. 1186.46 0--.7, 608.62

6A/,.-7 43:2.>0

340.48

>.>6F

There is increase in the de osit )' Rs.340.48.acs as com ared to last 'ear i.e. increase )' >.>6F. *mrut ?um)h The! @rein!estmentA "cheme increased )' 144.44.acs as com ared to last 'ear i.e. increased )' 12.47F The ratio of 5emand 5e osit is still too lo& as com ared to time de osit i.e. around 68.10F. (ranch should ma-e an effort to increase its demand de osits# &hich has lo& cost as com ared to time de osit. <urther ratio of de osits to ad!ances is onl' 162.64F i.e. ad!ances are 0.61 times of de osits. (iB'd Matur'd D'posits; $s.00,/A,7.7.0. *fter the due date of the de osits# the' are transferred to matured de osit a/c. Bn matured de osit a/c there are some )alances# &hich are of Rs.8.30# Rs.10.10 or Rs.20.20 total to Rs.10#21#348.00 u to 31.03.2008. 6ut of )alance Rs.86#06#160.00 for the 'ear from 01.04.2008 to 31.03.2006 not cl'ar'd u to 06.08.2006 Rs.22#80#381.00 $anagement should ta-e some action to clear such )alances. <iDed 5e osit Certificates num)ering 22 and are alread' matured are l'ing &ith the )an- authorities.

## AD=ANC+!; The com arati!e anal'sis of ad!ances is as follo&s/ %articulars *. "ecured *d!ances $achiner' .oan @*utoA $achiner' Consum tion .oan $achiner' 4ehicle .oan %lant & $achiner' "ecured @.& (A Term .oan *d!ance against 5e osit .oan *gainst 2old "alar' 2uarantee Term .oan .oan *gainst 2o!t. "ecurities 4astu Tathstu .oan 6!erdraft against <iDed 5e osit Total * -3A8 .3/ ..88 /6.0 3 A.7. 7/.0 3 -/6. 7-... 38 0.A. // A.--7./ 3 .... 1>03. >6 0.77 1>6.0 6 0.00 101.3 64.>3 2F F 0.00 0.03 F @1:.> 0.:8 4FA F @48.3 0.26 :FA F 11.47 1.:1 F F 31.70 4.27 F F 68.10 3.4> F F :2.:8 20.71 F F >1.>4 0.24 F F 12>.0 0.83 4F F @100 0.00 FA F 22.:6 7>.13 F F @Rs. <.=. 200806 Bn .acsA <.=. Bnc/ 2004- @5ecA 08 F inc/ F of @decA total

30.3> @8.67A 13.>3 @6.23A 4>.28 74.40 61.11 332.0 7 4.14 6.>3 8.43 30.11 37.>: 2>8.1 3 2.7> :.88

1.20 @1.20A

/3/. .03

2278. >>

824.7 1

(A "ecured *gainst %ersonal 2uarantee "hort Term ,nsecured Bnstallment .oan Total ( T6T*. @*G(A

7..A3., 3,., / /8.6 ...

4.>> 62.11

0.24 8.03F 16.20 26.0: F

0.1> F 2.>0 F

66.:: 2362. 68

16.44 841.3 8

24.8: 2.:> F F 22.71 100.0 F 0F

The total ad!ances of the (ranch ha!e increased )' Rs.841.38.acs as com ared to earlier 'ear i.e. increased )' 23.00F. $achiner' 4ehicle @*uto Ric-sha&A loan has increased )' Rs.1>6.06.acs. "alar' 2uarantee .oan has increased )' Rs.2>8.13.acs# "alar' 2uarantee Term .oan has increased )' Rs.2>8.13.acs# $achiner' Term .oan has decreased )' Rs6.23.acs# and "ecured Term .oan has increased )' Rs.8.42.acs as com ared to last 'ear. Bt is e!ident that the )ranch is concentrating more on auto ric-sha& .oan that is 64.>3F# and "alar' 2uarantee .oan that is 21F of the total ad!ances of the )ranch# &hich is !er' ris-'. ### =+$DU+!;

Total 6!erdue of the )ranch is Rs.282.84lacs @2:28accountsA# &hich has increased )' Rs.4.73.acs i.e.44.44F as com ared to the earlier 'ear. %ercentage of o!erdue to ad!ances is :.67F# &hich &as >.40F last 'ear. 6ut of the total o!erdue# Rs. >2.66lacs@>:.34FA are of $achiner' 4ehicle @*uto Ric-sha&A# Rs.10.01.acs @10.>7FA are of $achiner' @4ehicleA .oan# (ranch should ta-e action for reco!ering its o!erdue and increase its rofita)ilit'.

#= (#NANC#AL C M1A$#! N!; The o!erall financial com arati!e anal'sis is as under/ @Rs. Bn .acsA %articulars <.=. 2008- <.=. 200406 08 5e osits *d!ances Wor-ing Ca ital $anagement 3D enses Bnterest on *d!ances Bnterest on 5e osits 1et %rofit @1et %rofit is )efore de)ts.A 4>23.18 2704.00 846>.63 H 3:8.64 43:2.>0 2362.64 4488.>: 83.80 2:1.16

306.63 303.0: 167.0> 81.7: ro!ision for )ad and dou)tful

1et %rofit of the )ranch has increased )' Rs.11>.07.acs i.e. increased )' 228.26 F as com ared to last 'ear. The &or-ing ca ital has increased )' Rs.1011.:8 .acs i.e. )' 22.>:F as com ared to last 'ear. %ercentage of rofit to &or-ing ca ital is 3.07F as com ared to 1.1>F in the last 'ear. %ercentage of *d!ances to de osits is 61.4:Fi.e.0.84times of de osits# indicating that the )ranch is under trading. *n ad!ance has increased )' Rs.841.361.acs @)'.22FA &hereas de osits ha!e increased )' Rs.340.48.acs @)' >.>1FA. (ranch should ma-e sincere efforts to increase its de osits so that liCuidit' and adeCuate margin is maintained.

=. BALANC+ !"++) ANAL*!#!;

>-? A!!+)!; -? Cash Balanc'; $s. -3,./,63.... We ha!e h'sicall' !erified the closing cash )alance of Rs34#03#7:8.00 6n 2> th * ril# 2006@6 eningA# &hich is tall'ing &ith the cash)oo- & is correct. Retention limit of the )ranch is fiDed at Rs. 20.00 lacs. Cash in hand has eDceeded the retention limit on se!eral occasions# for &hich ost sanction limit is ta-en at committee meetings. "ome of the instances are as follo&s/ Dat' A5ount >$s.? 14th $arch# 2006 16th $arch# 2006 1:th $arch# 2006 20th $arch# 2006 28th * ril# 2006 30#4:#66> 23#42#>67 21#71#:01 20#01#24> 2:#28#::2

K'& Mo<'5'nt $'@ist'rs; ?e' $o!ement register is dul' maintained and u dated. )ok'ns; We ha!e h'sicall' !erified to-en 1 to 300 and found the same to )e correct. To-en missing are 7# >:# 17# 284# 2:3 .oss of To-en is of eriod of 2004. (or L'ss than $s.10000 Teller s'stem is used. <or a)o!e 10000 To-en are used. *t a time 100 To-ens are released .ist of the missing to-en is not dis la'ed outside the Cashier Ca)in

/? Banks; iA

Balanc'

4ith

th'r

(an- of $aharashtra# C.2 a/cRs.1#66#33#721/20 (alance as er )an- record is Rs.>0#40#460.4: (alance confirmation certificate is on record# (an)alance tallies &ith )an- confirmation su)+ect to reconciliation statement# &hich is on record.

iiA (an- of $aharashtra# CC a/c Rs.26#41#037.>0 (alance as er )an- record is Rs.24#24#464.>0 (alance confirmation certificate is on record# (an)alance tallies &ith )an- confirmation su)+ect to reconciliation statement# &hich is on record. iiiABndian 6!erseas (an-/ Rs.22#43#434.00 (alance confirmation certificate is on record# )alance tallies &ith the )an- ledger statement# &hich is on record. i!A Central (an- of Bndia/ Rs.2#64#174.00 (alance confirmation certificate is on record# )alance tallies &ith the )an- ledger statement# &hich is on record. !A $.".C (an- <ort# $um)ai Rs.12#73#741.:2 (alance confirmation certificate is on record# )alance tallies &ith the )an- ledger statement# &hich is on record. !iA ;5<C (an- @ne& a/cA / Rs.1>#:>1.47 (alance confirmation certificate is on record# )alance tallies &ith the )an- ledger statement# &hich is on record. 3A Loans; a. The ad!ances of the )ranch ha!e increased )' Rs.841.38lacs i.e. increased )' 22.71F $achiner'

4ehicle .oan for *uto Ric-sha& has increased )' Rs.1>6.06lacs# &hereas "alar' 2uarantee .oan has increased )' Rs.2>8.13.acs as com ared to last 'ear. ). .oan funding of the )ranch is mainl' concentrated on $achiner' 4ehicle loans for auto ric-sha&# &hich is 64.>3F of total ad!ances and "alar' 2uarantee .oan# &hich is 20.72F of total ad!ances. Bt is suggested to di!ersif' the funding so as to reduce ris-/o!erdue. 6ut of the total o!erdue of the )ranch of Rs.282.84lacs# $achiner' 4ehicle @auto Ric-sha&A .oan o!erdue is Rs.1:2.28lacs# &hich is >2.16 F of total o!erdue and "alar' guarantee o!erdue is Rs.20.2>lacs# &hich is :.03F of the total o!erdue. 6?D'ad !tock; $s-706,A7 Bt includes furniture# fiDture and eCui ment etc. The )ranch has ro erl' maintained the stoc- register. We ha!e !erified the additions made to dead stocduring the 'ear# &hich consist of (ranch Wooden Cu )oard Rs.14210.00 on 2:.01.2006# (undle 1ote Counting $achine of Rs.38#000 on 14.02.2006# *luminum & ;ard&are %arts Rs.1>#000 on 10.03.2006# and Reco!er' 6ffice Ca)in Rs.3#07:.00 on 31.03.2006. 5e reciation is ro!ided on dead stoc- during the 'ear on &ritten do&n !alue method eDce t for additions# on &hich de reciation is charged ro ortionatel' from the month of urchase 7?!'5i D'ad !tock; $s./83.... *dditions to "emi dead stoc- consist of %lastic (arrel Rs.680.00 on 16.03.2006. "emi dead stoc- &ritten off during the 'ear is Rs.618.00. 5e reciation is correctl' charged on semi dead stoc- during the 'ear I20F on &ritten do&n !alue method. 0?Co5put'r D'ad !tock; $s.-6-,83...

*dditions to com uter dead stoc- consist of %urchase of ten ,%" )atteries during the 'ear on 21 st 6ct. 2008 amounted to Rs.31800.00 and one Com uter urchased for Rs.>3800 on 12th 1o!. 2008. 5e reciation of the earlier 'ear no& ad+usted Rs.>::30.00# ;u) "ent to ;.6 at a !aluation of Rs.2000 )eing Written 5o&n 4alue. 5e reciation is charged on "traight .ine $ethod in the current 'ear I33.333F Till .ast 'ear it &as charged on Written 5o&n 4alue $ethod. Rectification of short ro!ision of Rs.>::30 is carried do&n in the current 'ear A?Air Condition'r; $s.-,3A,,6.... There are no additions or deletions to air conditioners during the 'ear. 5e reciation is correctl' charged during the 'ear I10F on &ritten do&n !alue. 3?Branch Adjust5'nt Account; iA Kop'r Khairan' Branch Adjust5'nt Account; D'bit $s.633..-88.37 (alance as er (ranch is Rs.4#:6#>>#8:8.:8# &hich tallies &ith the ledger )alance su)+ect to reconciliation entries# &hich is not cleared till the date of audit. iiA "'ad ::ic' Adjust5'nt Account; D'bit $s.-A,-/7A08.,A (alance as er ;.6 is Rs.# &hich tallies &ith the ledger )alance su)+ect to reconciliation entries# &hich is not cleared till the date of audit. 8? !undr& Ass'ts; iA "toc- of "tationar'/ Rs.278318.40 Bt includes )alance of stationar' remained at the 'ear-end.

iiA

Tele hone *d!ance/ Rs.18370.00 Bt re resents de osit &ith ("1.# &hich is &ritten off during the 'ear I10F on the )alance amount.

iiiABnterest recei!a)le on 1%*Es/ Rs.>003:38.00 iiiA %re aid 3D enses/ Rs.81676.00 Bt includes re aid )an- insurance Rs.1024 and em lo'ees gratuit' insurance remium of Rs.3:173.00# *ir Conditioner *$C 4634# and ($C TaD Rs.>:48 res ecti!el'

i!A 3lectric 5e osit @(3"TA/ Rs.10:422.00 Bt is de osit aid for 3lectricit' 5e osit and is same as er last 'ear. !A *dhesi!e "tam / Rs.>::0 Bt re resents )alance of stam a er and re!enue stam as on (alance "heet date. We h'sicall' !erified stam s in hand on date of our audit i.e.2>.04.2006

!iA <esti!al *d!ance/ Rs.12000.00 <esti!al *d!ance is recei!a)le from em lo'eesE salar' in 10 eCual monthl' installments. BB -? .B*(B.BTB3"/ D'posits; $s.6A,/,,-6,06/.7A There is increase in the de osit )' Rs.340.48.acs as com ared to last 'ear i.e. increase )' >.>>F. *mrut ?um)h The! @rein!estmentA "cheme increased )' 144.44.acs as com ared to last 'ear i.e. increased )' 12.47F 5am du at increased )' Rs.42.88.acs i.e. )' 4.>0F

The ratio of 5emand 5e osit is still too lo& as com ared to time de osit i.e. around 68.21F. There is little im ro!ement o!er last 'ear. 5e osit should )e increased to maintain liCuidit' and adeCuate margin /?Bills $'c'i<abl'; $s.03/3.... 6ne (ill of Rs.2:44 &as 6utstanding on the date of (alance "heet date# &hich &as su)seCuentl' cleared on 4/4/2006 ,?#nt'r'st 1a&abl'; $s.68A-,6... This include interest a'a)le on de osit at the 'ear end 6?!undr& Liabiliti's; iA 6!erdue Bnterest Recei!a)le/ Rs.>003:38.00 Bt includes Bnterest charged to 1%* accounts )ut not reco!ered and is sho&n as contra item. Bt increased )' Rs.64.>7.acs as com ared to .ast =ear i.e. increased )' F iiA "undr' Creditors/ Rs.272236.00 Bt includes sitting fees a'a)le to committee mem)ers# closing allo&ances a'a)le to em lo'ees# ro!ision for tele hone eD enses# &hich are su)seCuentl' cleared eDce t follo&ing &hich are ending till the date of our audit i.e.20.04.2006 5ate %articulars *mount @Rs.A

iiiA .oc-er "ecurit' %a'a)le/ Rs.6:1200.00 Bt includes interest free de osit ta-en from loc-er holder as a securit' 10 .oc-ers of Rs.10000 each# 20 .oc-ers of Rs.8000 each and 173 .oc-ers of Rs.3000 each are gi!en to holders Bt is o)ser!ed that out of total 180 .oc-ers 2> .oc-ers are !acant as on 31.03.2006# (ranch $anager should encourage customer to a!ail .oc-er facilit'. "o that Bnterest <ree 5e osits Bncreases *mt 1o of 1o of recei! Total loc-ers 1o of loc-ers a)le *mt *ctual 5iffer a!aila)le loc-ers occu ie on recei!a amount ence . !acant d each )le recei!ed 10000 10 0 10 10000 0 72000 10000 20 0 20 8000 0 100000 8>700 280 2> 173 3000 0 4::600 >>700 0 6:0600 7:400 .oc-er returned )ut amount is still l'ing in the .oc-er 5e osit a/c/ Rs.600.00 i!A %a' 6rder/ Rs.6#36#17>.00 These re resents 60 ending a' orders at the 'ear end &hich are cleared su)seCuentl' eDce t for 21 a' orders for Rs.668: &hich &as ending

T' e of .oc-er * class ( class C class

17.10.2008 1>.10.2008 17.11.2008 17.11.2008 2:.12.2008 2:.12.2008 2:.12.2008 10.01.2006 10.01.2006 01.02.2006 13.02.2006 14.02.2006 14.02.2006 18.02.2006 23.02.2006 02.03.2006 21.03.2006 2>.03.2006 2>.03.2006 2:.03.2006 27.03.2006 27.03.2006

22:87 22:82 23006 2300> 232:2 232:3 232:4 23363 23364 234:3 23:2: 23832 23833 23837 23871 23640 23>37 23>61 23>66 23>:0 23>72 23>73

80 47: 80 80 40 40 40 40 40 210 100 100 100 3000 1000 100 100 400 100 400 100 100 668:

4A

(an- 2uarantee/ Rs.180000.00 This re resents 1 (an- guarantee issued )' )an- on )ehalf of customer# &hich is sho&n as contra item in the (alance "heet.

8A ,nclaimed 5i!idend/ Rs.882.80 Bt re resents 5i!idend a'a)le of <inancial =ear 2002-03 of Rs.178/- and of <inancial =ear 2003-04 of Rs.178/- and of <inancial =ear 2004-08 Rs.162.80 6A %ro!ision for 3D enses/ Rs.1#13#:0>.00 1articulars 1ro<ision 6ffice Rent Rs.7440.00

"oft&are *$C 3lectric (ill Tele hone 3D enses

Rs.416>.00 Rs.70082.00 Rs.1014.00

(ranch %rofit are under stated/ o!er stated )' Rs. due to eDcess/short ro!ision. >A (alance &ith ;.6. and (ranches/ i? Bori<ali Branch Adjust5'nt Account; Cr'dit $s./,/667.,.30 (alance as er (ori!ali (ranch *d+ustment Rs.2#32#30#683.:6 &hich tallies &ith the ledger )alance su)+ect to reconciliation entries# &hich is not cleared till the date of audit. 3C" cheCues returned )ut &rongl' de)ited/credited# )ut not acce ted )' the )eneficiar' )an5ate *mount :.11.2008 2000.00 14.11.2006 1006.00 iiA )han' Branch Adjust5'nt Account; Cr'dit; $s./6A76663.03 (alance as er Thane )ranch statement Rs.24>23706.:0# &hich tallies &ith the ledger )alance su)+ect to reconciliation entries# &hich is not cleared till the date of our audit. :A 5emand 5raft %a'a)le/ Rs.186>:4.00 2: 55Es are outstanding on the (alance "heet date# out of &hich the follo&ing &ere ending on the date of our audit. follo&ing are long outstanding ending 5.5Es 5ate 55. 1o %articulars *mount @Rs.A 1:.11.03 243> 4. R. (ote 8>.00 08.02.04 1:>44 ;indushthan 360.00

1:.02.08 1:.02.08 21.02.08 18.03.08 21.03.08 24.03.08

2>401 2>402 8468 64111 64114 2>403

%ra-ashan 5irector BT3 5irector BT3 5irector BT3 2aura! %lastic 2aura! *gro %lastic (an- of (aroda

100.00 100.00 200.00 1800.00 1000.00 128.00

:A Bncome TaD %a'a)le/ Rs.>1::.00 This re resents taD deducted on interest on de osit as on 31.03.2006 and the same is aid on 06.04.08. ;o&e!er# it is o)ser!ed that the )ranch has not considered 3ducation Cess I 2F &hile deducting & %a'ment T5" =#. 1$ (#) 2 L !! ACC UN) ANAL*!#!; %articulars (. * <.= Bncrease/ .7-.0 04-08 @5ecreaseA *. B1C6$3 Bnterest on .oans and *d!ances ,37.06 Bnterest on (alnce &ith other )ranches -68../ Commission & (ro-erage /.,A 6ther Recei ts -..-0 T6T*. @*A (. 3J%315BT,R3/ Bnterest on 5e osits Bnterest aid @Bnter 76A.-8

F Bncrease/ @5ecreaseA

2:1.16 126.30 2.82 2.>> 412.>8

104.4: 22.>2 -0.18 >.37 134.44

3>.16F 1>.77F -8.78F 266.>7F 32.8>F

,.0.06 3.03

303.0: 0.00

3.86 :.6:

1.1>F

(ranchA "alaries & (onus "itting fees to Committee $em)ers Rent TaDes and Bnsurance .a&'ers <ees & Court <ees %ostage# Telegram & Tele hone *udit <ees 5e reciation Com uter 3D ense "tationar'# %rinting and *d! Commission 3m lo'ees & 5irectors Tra! 3D 6ther 3D enditure T6T*. @(A 13T %R6<BT @*-(A

,,.70

32.21

1.38

4.17F

../7.A..0. ..68 -.-0 7.-7 ..-6 -.,A ...3 ..A-,.0/ ,A3.-/ -08..A

0.16 4.8> 1.70 0.68 1.14 4.22 0.81 1.31 0.12 0.87 10.31 360.>> 81.7:

0.08 1.14 -1.3 -0.16 0.02 0.73 -0.3> 0.06 -0.04 0.12 3.31 1>.38

31.28F 24.78F -6:.42F -24.62F 1.>8F 22.04F ->2.88F 4.8:F -33.33F 20.34F 32.10F 4.:1F

11>.07 228.26F @Rs. in .acsA

@1et %rofit is )efore de)tsA

ro!ision for )ad and dou)tful

%rofits of the )ranch has increased )' Rs.11>.07.acs i.e. increase )' 228.26F as com ared to .ast 'ear. Bnterest aid on de osit is increased )' Rs.1.1>.acs as com ared to .ast 'ear. 2A (ranch does not charge enal interest to )orro&ers for non-su)mission of 'earl' financial

statements. %enal Bnterest reco!ered from o!erdue accounts is credited to %rofit & .oss account Till .ast 'ear it &as transferred to ;.6. account. Bt is rectified as ointed out )' the earlier *uditor 3A 5e reciation on assets is charged at the follo&ing rates on W54 method/ "emi 5ead "toc- & .i)rar' 4ehicle 5ead "toc<urniture# <iDture *ir Conditioner I20F I20F I2.8F I10F I10F

5e reciation on Co5put'r is charged I33.333F on <iDed Bnstallment $ethod or "traight .ine method. *s ointed out earlier 'ear# 5e reciation of the earlier 'ear ad+ustment @RectificationA is carried out in the current 'ear 5e reciation on charged ro ortionatel' from the date of recording instead it should )e as er Bncome TaD .a&s.

1A$) C 1A C6$$31T" 61 *54*1C3"/ We ha!e !erified on test chec- )asis documents of ad!ances sanctioned & rene&ed during the audit eriod and our remar-s are as under/ *$*C;B13R= 43;BC.3 .6*1" *CC6,1T @*uto Ric-sha&A

*1- 2eneral Remar-s/ 1A 2A *gent $r "ahe)rao *dhate is guarantor for all loans. Bt &as decided to ta-e his signature as third Witness. Bn all cases cash memo )' K2anesh $otorsE for accessories is attached none of these are stam ed. These memos do not )ear an' sales taD or ser!ice taD registration no. 1ature of item is not stated. 4er' )rief and general descri tion is ro!ided. Bn some cases cost of the same items are !ar'ing in t&o different memos. These discre ancies ma-e genuineness & correctness of these memos Cuestiona)le. %ur ose of financing is for urchase of 4ehicle. (ut in most of the cases# loan is dis)ursed after registration of !ehicle. (orro&er is the guarantor of the loan 9 2rou of three eo le is made 9 "o# the same )orro&er can )e guarantor for other t&o- Bt is a &rong ractice as the' donEt chec- the re a'ment ca a)ilit' of the )orro&er

3A 4A

8A 6A >A :A 7A 10A 11A 12A 13A 14A 18A ACc No 1>06

.oan is rescheduled se!eral @Bn some cases three to four timesA in case of ina)ilit' of re a'ment. 4aluation re ort is attached to confirm the !alue. .ife of 4ehicle is not more than "e!en 'ears. Bn some cases e!en old ones are rene&ed. Bnsurance is ,nder!alued in all cases- it is Bnsured to the eDtent of .oan ta-en# man' of the cases rene&ed Bnsurance olic' is not found. 6n R.C.T.C co ' Thane or 1. $. 0oshi $arg (ranch is assigned and .oan is from (ori!ali (ranch and 4ice 4ersa. RCTC )oo- ha!ing )an-Es charge is not on record. Bnsurance olic' not on record. Bncome %roof of )orro&er is not on record. *ffida!it a ers are found )lan-. Residential %roof of )orro&er & guarantor not on record Residential %roof# 3lection Card & other 5ocuments not attested 6riginal (ill is not there. Luotations and estimates and MeroD co ies are onl' there. Na5' 5ee ale "uresh (alu $'5ark "taff *ddress field not filled 6!er due a/c 9 not lin-ed to salar'H Bnsurance due date 11.02.08 not rene&edH Rene&ed four times <rom 2001 a/c no 16:: Recon-for Rs.70000.00 a/c 21>4 Recon-for Rs:8000a/c4222a/c closed on 20/3/2008

60:0

2a&de 5e!ra+ Range

Recon-for Rs:8000a/c60:0 .ast a'ment recd 27.11.2008 60>7 (alasahe) "o an 1:/6/2004 a/c no3718 Rs.78000 closed 2:/3/2006. 1ot once the art' has aid and again the loan &as granted on 31/3/2006 <itness Certificate eD ired on 2/3/2006 6riginal R.C.T.C. )oo- not there. 6nl' NerD is there Rs.>8000 on 16/2/2006 RC )oo- )ears the name of (ori!ali (ranch. Rs.70000.00 on 16.02.2006 Bnsurance eD ired on 6/02/2006 <itness certificate eD ired on 13/02/2006 6ld a/c 2847 dt17.02.2003 Transfer (ori!ali 6ld 370: Bnitial loan Rs.78000.00 onl' Rs.16000 &as aid )alance Rs24800 &as aid )' "ainath and again 16.02.2006 .oan of Rs.78000 &as granted. RC )oo- is of Thana 6ld a/c no 3163 Rs100000 on 2/7/2003 after 1>/04/2004 nothing aid )' art' 9 "ainath aid the )alance "ale certificate2/01/06 .oan dis)ursed2:/03/2006

8777 8773

"hri Mu)air "hai-h %ush a .aDman cha!an "ira+uddin "aida %a&ar 5ondia Ra+aram

8772 8771

87::

0eth *+it ?eshar

60>>

$nas-e Ra!indra "han-ar

6064

"ingh Ra+esh-umar Ramasha-ar

6063 4117

Chatra)ho+ "hi!a+i Ra+gor %aigan-ar *run ?amal-ar

1677 87>8 866: *)dul $a-dum Ta+$ohd. Cha!an 2anesh "itaram

Bnsurance olic' not on record 2uarantor for a)o!e (ill not on record ,nder Bnsured Rs.100000 )alance on 31/3/2006 Rs.>7610. "ome amount is aid )' "ainath 9 o/s for more than 6months Bnsurance a er not on record after 31.08.2008 6ld 2766 Transfer from (ori!ali >/01/2006. Brregular 6ld a/c 338: 4/11/2003. some amt aid )' "ainath on 14.03.2008 than on 27.06.2008 & on 24.10.2008 than rescheduled for Rs78000.00

"ecured .and & (uilding Term .oan 30 *cti!e a/c are there .oan rescheduled on 21st $arch 2006 for the fourth times a/c no 306 & 30> Redem-ar %andurang 6ld a/c nos202# 286# 287# 272# 273 .oan for Rs.40000 and Rs.60000# Bnsurance %a er not on record. Bncome %roof not there. 5ocuments not attested. Closing (alance Rs.368:8 & Rs84:62. $em)er no :76 $em)ershi amount Rs3000 */c no 303 "ita Ram (a)u rao for :0000 old a/c no 178# 23># 240# 2:0 Bnsurance eD ired <e) 2008 Rene&ed olic' not on record. 5ocuments not attested */c no 308 rescheduled fourth time 177# 2::# 241 5orugade $ohan 2an at rene&ed on

13/03/2006 for Rs.40000.00 closing )alance 4031: Bncome %roof not there. Bnsurance a er not on record */c no 30: %andit $ahade! (a u .oan Rs.100000 Closing )alance 100278 .oan rene&al not on record. Bncome roof not there $achiner' Consum tion 1e& .oan not there T&o *cti!e a/c are there */c no 6 of 1/4/2001 & a/c no >of 1/4/2001 )oth are o!erdue a/c %lant & $achiner' .oan 6nl' t&o acti!e a/c are there */c no 18 ?atal-ar san+a' *nant 1/4/2001 8817:8 Closing )alance 844>:6.28 */c no 21 "hu)h *rts 860000 Closing )alance 24>061 4aastuThatsu ;ousing .oan */c 1ame of a/c .oan amount no holder 7 Closing Remar(alance

.oan

on

.oan on 10/8/2002

1air "hu)a Rs.>00000.00 >11384 @3: 'earsA Teacher6n 1/3/2006 for 18'ears I10F Cha!an Rs.260000.00 261>12 Bncome Ra+aram roof

>

@84 'earsA loan date 17/01/2006 2o!il-ar Rs228000.00 "hanta ram @32 'earsA 13/12/2004

Bnsurance a er not on record Bncome roof not there Bnsurance rene&al a ers not there

!alar& %uarant'' Loan ACc Na5' o: aCc no hold'r 708 $ore ,ma+i age 48'ears Loan Closin@ $'5ark a5ount 200000.00 200483.00 5ocument not attested "alar' sli of <e) 2008# ur ose of loan house re air- Cuotation not on record. 2uarantor for 2 other loan a/c 704 & 703 .oan from "ociet' is alread' there 200000 200483 1o guarantor for this loan# documents not attested. %ur ose of loan house re airCuotation not on record. 1et "alar' :436 .oan from

706 2ohil 5inesh age 38 'ears

704 Chi a !ar+esh&ari 38'ears

703 "ona!ane 2aur'a 40'ears

"ociet' is alread' there 200000 200483 5ocument not attested "alar' sli of <e) 2008# ur ose of loan house re air- Cuotation not on record. 2uarantor for 2 other loan a/c 708 & 703 .oan from "ociet' is alread' there 200000.00 200483.00 5ocument not attested "alar' sli of <e) 2008# ur ose of loan house re air- Cuotation not on record. 2uarantor for 2 other loan a/c 704 & 708 .oan from "ociet' is alread' there

,nsecured "hort Term .oan .oan for 18 months I18F */c 1ame no 211 %andit "hi!a+i $ahade! 210 ?arude *nande )alu *mount 28000.00 28000.00 5ate 31/03/2006 27.03.2006 Remar-

207 (ol-e ?rishna 20: "hende Bsh&ar 20> %andit (hago+i !A=#N% ACC UN)!;

28#000.00 2:.03.2006 28000.00 28000.00 >.02.2006 14.10.2006 1othing is recd

1. 1o of *ccounts/ 86000 Test Chec-/ 38 *ccounts 2. When the *ccounts are o ened# letter is not sent to the art' to confirm the address )' eDisting *ccount ;older. 3. *ddress %roof of the follo&ing account holder not ta-en. 947787#47782#47781#47783#80631# 80:13# 80:>4 4. 3arlier there &as a ractice to ta-e onl' t&o hotogra hs instead of three. The' changed it to three no&. 8. %hotogra h not ta-en @*ccount 1o 47214# 47177# 471>6# 47777# 80101#80102#477:6# 47:01# 47>77# 47>7># 47>74# 47>70# 47638# 47601# 806>7# 80:14A 6. 4erified "tam is not ut on the form. >. "ignature and %hotogra hs of all *ccountholder is not full' com uterised. :. *dditional 0.8F Bnterest Rate * lica)le to ;ousing "ociet' as is not gi!en. 7. *dditional 0.8F Bnterest Rate * lica)le to "enior CitiNen is also not ro!ided. 10. CheCue Return @6ut&ardA charges are constant for all amounts @Rs. 86/- er cheCueA earlier Rs. 28/er cheCue. Bt should )e higher for )igger amount to discourage such ractice. 11. CheCue Return @Bn&ardA charges are 86/-. 12. "taff sa!ing account not lin-ed 13. *ccount close stam not there after raising the Cuer' it &as rectified &hen &e ointed out to them. (ut still on all a/c it is not there.

14. $inimum (alance Charges 9 Rs 6/13 Closure of *ccount &ithin 6 months is Rs.100 and after 6 months Rs.80 14 To o en sa!ing *ccount introducer is Current *ccount holder. 18 <orm 60 or %*1 card NeroD o)tained in all cases that &e test chec-ed. 16 "u orting documents are !erified and signed )' concerned officer 1> 6ne 5ifferent t' e of (usiness 5i!ersion/ ractice started )' the (an- from 18/6/2008. *d!ocate -o en an a/c for Bnsurance claim of !arious customer- ;e onl' o ens the a/c )' ta-ing guarantee and res onsi)ilit'. 6nce the Bnsurance amount is credited the' close the a/c immediatel' &ithin a s an of 18 to 21 da's. *d!ocate a's the amount in cash to the customer and &ithdra&s claim amount in cash. Till no& )an- reco!ered a roD 180000 as closing charges. @#s it a ri@ht practic'DDDA CU$$+N) ACC UN) 1. Confirmation )' ost is not there 2. "tam not there 3. "a!ing *ccount eo le introduced Current *ccount @*/c 1o 12>:# 12:4A 4. %hotogra hs 9 onl' 2 instead of three 8. Co ' of esta)lishment roof is not there in all cases as the' are small !endors @eD lanation gi!en )' managerA 6. 6m enter rises 9 */c no 1213. .icense agreement not on record >. Current *ccount 12>>- %ro er !erification not done 9 <orm 60 and declaration not there )+$M D+1 !#) 3!en after maturit' 5e osit recei ts lie &ith the )an-. "ome recei ts are of 2008 e!en of 2004 is there.

CA!" 1. Cash .imit Rs.1800000 2. $ost of the da's it crossed Rs.1800000. 6n da' of *udit i.e.1>/04/2006 it &as Rs.2344:46 3. Cash (alance on 31/3/2006 Rs.118470: !erified )' 5i!isional $anager- .o&er %arel (ranch BANK BALANC+ 1. (an- (alance &ith The $um)ai 5istrict Central Coo erati!e (an- .imited @$5CCA is constant from .ast 'ear. There is no income on this account. (anconfirmation on same is a!aila)le 2. (an- of $aharashtra# (ori!ali (ranch (alance Rs.118470: Reconciliation of the same is a!aila)le. L AN! 2 AD=ANC+! !alar& %uarant''; Total 1o of a/cs 666 of &hich 316 are not regular a/c .6*1" & *54*1C3"/ @643R5,3A )&p' o: Loan Machin'r& ='h Loan Mach ='hicl' >auto $ick? Mach Consu5ption Loan 1lant 2 Mach No !anction a5t. Balanc' <'rdu'

6 23 :3 2 1

2470000.00 223>>>000.00 100000.00 800000.00

233>3>4.0 22>86: -3A83- 64.>3 0 3.00 837... F 181::>0> 1:224: /60360 0.:8 4.00 26.00 ..8. F 7701:.0 88.-3. 0.03 7701:.00 0 .. F 844>:6.28 844>:6. A68077 0.26

Loan Ad<anc' a@ainst D'posit Loan a@ainst %o<t !'curit& Loan A@ainst %old !'cur'd >L2 B? )'r5 Loan !alar& a@ainst %uarant'' !hort t'rr5 Uns'cur'd Loan =astu )hatsu "s@ Loan )'r5 Loan Uns'cur'd 20:13.00 1307388:. 10 1401000.00 00 261242>0. 2:1 2:2:000.00 00 268>466.1 137 328>000.00 0 2 1 20000.00

00

20:13.0 0 124806 4.00 202>24 7.00 :141:4. 00

328000.00 320610.00 2:80.00

17>0:476 282844 2:28 23467:000 7.4 >3

./7 -/67-/ A-... A-.368 ... -..330 A6... 7/03/, /.,0 0.A//. 60... 7..77. ... -7/3.0 .... A3,.A/.-. /8.,88 7-,.0-

F 4.27 F 0.24 F 3.4> F 1.:1 F 20.71 F 0.1> F 0.83 F 2.>0 F 100F