INTERIM STATUTORY AUDIT REPORT

MUMBAI KAMGAR
M.G.S.S.MARYADIT
CKS
APNA BAZAR CO-OP
(APMC WAREHOUSE)
By Sanjay Rane & Associates (Chartered Accountants)
Period: From 1st April 2018 to 30th September 2018
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

APNA BAZAR
APMC WAREHOUSE DEPARTMENT
AUDIT PERIOD 01.04.2018 TO 30.09.2018
INDEX
SR NO. PARTICULARS PAGE NO.
1 Yearly performance 3-4
2 Ratio Analysis 4
3 Details of Internal branch 5
Transfer
4 Details of Internal departments 6
Transfer
6 Sales Target, internal Control 7
Compliance and Staff Strength
7 Balance sheet Scrutiny 8
8 Profit & Loss vouching 11
9 Irregularities & Suggestions 14
10 Annexure 15
11 Vote of Thanks 16

Sanjay Rane & Associates

Chartered Accountants 2
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

The Mumbai Kamgar Madhyavarti Grahak Sahakari Sanstha Ltd

Apna Bazar: APMC WAREHOUSE
Statutory Audit Report: 01.04.2018 to 30.09.2018

1.0 HALF YEARLY PERFORMANCE :

1.01 Financial Overview:

Particulars Year ended Year ended Growth

Sept-18 Sept-17
(In % (In % (In %
Lakhs) Lakhs) Lakhs)
Sales 10.62 100 10.33 100 0.29 2.81

Cost of Sales (23.54) (229.43) (0.71) (6.87) (22.83) 3215.49

Direct Income 0.40 3.90 60.57 586.35 (60.17) (99.34)
Direct Expenses 28.51 277.88 48.27 467.28 (19.76) (40.94)
Gross Profit 6.04 58.87 23.34 225.94 (17.30) (74.12)
Indirect Expenses 6.46 62.96 6.75 0.19 (0.29) 4.30
Indirect Income 0.05 0.48 0.02 65.34 0.03 150.00
Net Profit / (Loss) (0.36) (3.51) 16.61 160.79 (16.97) (102.17)

Analysis of the above tabulated financials,

 From the above table, it is observed that the Sales had Increased by Rs. 0.29 Lakhs i.e.
2.81% as compared to corresponding previous period April 2017 to Sept. 2017. It is
mainly because department used to record all the branch transfers as sales till
previous years and from this year they are only recording Franchise Sales i.e. Other
than branch transfer.
 The direct expenses are decreased by Rs. 19.76 Lakhs i.e. 40.94% compared to
corresponding previous period April 2017 to Sept. 2017. It is mainly because the
expenses related to Transportation and Packing Material Charges are transferred to
individual departments and branches.
 However, Gross profit has decreased by Rs. 17.30 Lakhs i.e. 74.12% as compared to
previous period April 2017 to Sept. 2017. This is mainly due to reduction in Cost of
Sales. The Cost has been reduced by Rs. 22.83 Lakhs which is 3215.49% of the cost of
the period April 2017 to Sept. 2017.

Sanjay Rane & Associates

Chartered Accountants 3
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

 Net profit has decreased by Rs. 16.97 Lakhs i.e. 102.17 % as compared to previous
period April 2017 to Sept. 2017. It is mainly because of decrease in Direct income as
compared to previous period.

Variations in financial performance can be easily understood by the following

graphical presentation, (y axis reflect INR In lakhs)

100

10

1
Sept.18 Ended
Sept. 17 Ended

0.1

0.01
Sales Cost of Direct Direct Indirect Indirect
Material Income Expenses Expenses Income
Sold

1.02 Ratio Analysis:

Year ended Year ended

Ratios
September’18 September’17
Stock turnover 0.29 times 0.12 times
Gross Profit Ratio 56.91% 225.87%
Net Profit Ratio 3.43% 160.70%

Observation:
 Stock turnover ratio has increased as compared to corresponding previous period,
which is due to decrease in average stock holding by the department.

Sanjay Rane & Associates

Chartered Accountants 4
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

 Gross profit ratio has decreased to 56.91% from 225.87% during the audit period
April to Sept 2018. The Net Profit Ratio has decreased as compared to corresponding
previous period.

1.03 Internal Branch Transfers made during the period:

 Branch wise transfer is as follows:

Particulars Half Year ended

Sept 2018
(Rs. In Lakhs) %
TOTAL BRANCH TRANSFERS 213.57 100.00

CHEMBUR R.C.F. 34.46 16.14

DADARNAGRIK 30.10 14.09
DEONAR 21.16 9.91
GIRGAON 21.20 9.92
MAHIMRBI 8.03 3.76
NANA CHOWK 12.78 5.98
PAREL 26.31 12.32
SARDAR NAGAR 18.83 8.82
TARDEO 16.82 7.88
TILAKNAGAR 17.11 8.01
UNNATNAGAR 6.77 3.17

 APMC department makes branch transfers on cost.

Variations in sales can be easily understood by the following graphical presentation, (y

axis reflect INR in lakhs)

Sanjay Rane & Associates

Chartered Accountants 5
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

BRANCH TRANSFERS

3%
8% 16%
CHEMBUR R.C.F.
DADARNAGRIK
8%
DEONAR
GIRGAON
MAHIMRBI
9% 14%
NANA CHOWK
PAREL
SARDAR NAGAR

12% TARDEO
10%
TILAKNAGAR
UNNATNAGAR
6% 10%
4%

1.04 Internal Department Transfers made during the period

 Department wise transfer is as follows:

Particulars Half Year ended Sept

2018
(Rs. In Lakhs) %
TOTAL TRANSFERS 684.10 100.00

A.B. NAIGAON 126.58 18.50

A.B. FORT 49.89 7.29
A.B. MULUND 62.73 9.17
A.B. ANDHERI 174.06 25.44
A.B. CHARKOP 101.55 14.84
A.B. VASHI 34.35 5.02
A.B. UMARGAON 2.01 0.29
A.B. RATANGIRI 70.32 10.28
A.B. LANJA 22.54 3.29
A.B. DEORUKH 40.08 5.86
 APMC department makes inter department transfers on cost.

Sanjay Rane & Associates

Chartered Accountants 6
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

Departmental Transfers

6%
3%
19%

A.B. NAIGAON
10%
A.B. FORT
0% A.B. MULUND
A.B. ANDHERI
5% 7%
A.B. CHARKOP
A.B. VASHI
A.B. UMARGAON
9% A.B. RATANGIRI
15%
A.B. LANJA
A.B. DEORUKH

26%

2.00 Sales Target :

 As informed head office had not set any sales target for the period ending 30th
September 2017; however, the department store achieved sales of Rs.10.62 Lakhs.

3.00 Internal control & accounting work :

 Accounting of departmental store is carried out in Tally ERP as well as in SANVIK
software. Purchase Register is maintained in SANVIK software and the balance part
is covered in Tally.

Sanjay Rane & Associates

Chartered Accountants 7
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

4.00 Compliance :
 Department has sent rectification report to Head Office complying the observation in
the audit report for the period ended 31st March 2018.

5.00 Strength of Staff

 As per information given 11 staff is working at Fort department. (Refer Annexure 1)

SCRUTINY OF BALANCE SHEET

6.00 Liability:
6.01 Sundry Creditors – Rs. 44,30,494.97/-
 It includes amount of long pending creditors Rs. 6,839 (refer annexure 2)
 The society must take action against pending balances and clear it earliest.

6.02 Provision for Expenses – Rs.8,46,652.15/-

 It includes following:

PARTICULARS AMOUNT (Rs.)

APMC Tax Charges 1,360.00
Mathadi Wages Expenses 45,570.00
Conveyance & Travelling 100.00
Water Expenses 860.00
Telephone Expenses 5321.00
Printing & Stationary 284.00
Sundry Expenses - Officers 2,171.00
Sundry Expenses – Others 4,916.00
Salary Others 2,450.00
Salary Expenses for Turbhe 80,435.00
Salary Expenses for Turbhe Temp. Emp. 11,408.00
Packing Material Charges 4,08,530.15
Transport Charges For Sales 2,744,32.00
Wages Expenses 8,815.00
TOTAL 8,46,652.15

 Entity follows mercantile accounting policy for expenses and makes provision for
expenses incurred at the end of the month.
Sanjay Rane & Associates
Chartered Accountants 8
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

 Provision for Packing charges and transportation has been made on past estimates
since bills for the same has not provided by contractors.
 Journal vouchers are verified along with authorizes supporting and found same in
an order.

Provisions

APMC Tax Charges

Mathadi Wages Expenses

1%
0% 0%
5% Conveyance & Travelling
7%
Water Expenses
28%
Telephone Expenses

Printing & Stationary

0%
Sundry Expenses - Officers
1%
3%
Sundry Expenses – Others
0%
3% 1%
49% Salary Others
2%
Salary Expenses for Turbhe

Salary Expenses for Turbhe

Temp. Emp.
Packing Material Charges

6.03 Inter Branch Reconciliation – Rs. 19,20,751.06/-

 Branch accounts are reconciled as on. 30.09.2018
 For confirmation, department takes signature of the branch in charge of respective
branches or departments along with a stamp on reconciliation statement

Sanjay Rane & Associates

Chartered Accountants 9
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

7.00 Asset:
7.01 Fixed Asset :
 Asset account is maintained at head office & additions / deletions at branch
transferred at H.O.
 No addition or deduction to fixed assets during the year.

7.02 Closing Stock as on 30th Sept. 2018 – Rs. 36,10,732.00/-

 Physical verification of stock was carried on 30.09.2018.
 The Physical stock was in shortage by Rs.0.20 Lakhs as per physical verification and
as per liability register. (Refer Annexure 3).
 Department keeps stock with packaging contractors and variation has been found in
the same during stock take.
 Department gives its products for packing to contractors and contractor sales the
product after packing as per instruction given by APMC dept. and provides stock
sheet at the end of every month but reconciliation has not been done during the
period.
 Department is facing errors in SANVIK software on which they are depending for
closing stock valuation.

7.03 Deposit – Rs. 33,790.00

 This account consists of deposit paid to various authorities/ entities.(For details
refer Annexure 4)

7.04 Cash in Hand – Rs. 14,133.00

 Cash was physically verified by H.O. personnel’s or department manager during the
audit period.
 Cash was physically verified by us on 10.01.2019 and found in order.

7.05 Bank Accounts – Rs. 3,72,717.75

 Department has Bank account with Apna Sahakari Bank.
 Reconciliation is carried out on monthly basis.

7.06 Advance others – Rs. 7,000.00/-

 It includes stock taking against advance of Rs.7,000.

Sanjay Rane & Associates

Chartered Accountants 10
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

7.07 Packing Material – Rs. 93,898.00

 It pertains to stock of packing material that was unutilized as on 30.09.2018.
 APMC warehouse has maintained the stock register of packing material and found
correct.

7.08 Prepaid Expenses – Rs. 24,717.89

 Prepaid expenses pertain to amount paid for license fees, Rent, & other expenses.

SCRUTINY OF PROFIT & LOSS ACCOUNT:

9.0 DIRECT EXPENSES

9.01 Expenses A/c (Packing Material) – Rs. 26,07,012.75/-
 Expenses account pertains to packing material expenses.
 Dept. has given contract for packing material to K.K.Traders and K.C.Food & Spices.

4.01 Rent, Rates & Insurance – Rs. 4,60,154.38/-

 APMC warehouse has two premises which are gala no. L14 and gala no. L16. Out of
these two premises, gala no. L14 is owned by department and gala no. L16 is on
rental basis. These expenses are related to rent, license expenses, electricity expenses,
water charges, insurance charges and property tax.

4.02 Mathadi Wages – 3,06,070.00/-

 This amount pertains to wages given to APMC union workers for loading and
unloading of stock.

4.03 APMC Tax Charges – Rs. 11,343.00/-

 Department needs to give tax to Agricultural Produce Market Committee for
purchases and sales from the same market.
4.04 Salary Expenses –Rs. 14,81,405.00/-
 Salary expenses includes amount of salary of department & salary appropriation of
Head Office.
 Department has a policy of creating additional provision at the rate of 50% of gross
salary and same is transferred to head office as a share of provident fund, E.S.I.C. etc.

Sanjay Rane & Associates

Chartered Accountants 11
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

4.05 Other Expenses – Rs.20,15,126.38/-

 It includes following:
Particulars Amount (Rs.)
Wages Expenses 52,913.00
Expenses APMC 37,98,763.38
Transportation charges for sales 17,30,724.00
Total 20,15,126.38

5.0 Indirect Expenses

6.01 Bank Interest – Rs. 4,12,500.00/-

 Proportionate allocation of bank interest is made by head office which is debited in
this account.

6.02 Repairs & Maintenance – Rs. 1,09,130.00/-

 Expenses on account of repairs and maintenance have decreased by Rs.0.40 Lakhs as
compared to period ended 30.09.2017.

6.03 General expenses – Rs. 46,606.00/-

 Department has booked expenses incurred on payment basis.
 Department has not made further provision @ 0.05% of Sales as per Head Office’s
expenses Policy for departments.

6.04 Printing & Stationary – Rs. 20,129.60/-

 Expenses on account of Printing & Stationary have increased by Rs. 1,895.12/- as
compared to period ended 30.09.2017.
 Department has booked expenses incurred on payment basis.
 Department has not made further provision @ 0.05% of Sales as per Head Office’s
expenses Policy for departments.

6.05 Depreciation – Rs. 3,792.00/-

 Department has policy to book depreciation at 5% less than booked in last year and
10% on additional fixed asset.

Sanjay Rane & Associates

Chartered Accountants 12
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

6.06 Bank Charges – Rs. 9,120.00/-

 Bank charges include interest on OD account maintained by branch, same should be
shown separately under Bank Interest.

6.07 Other Expenses – Rs. 36,245.00

 It includes following expenses:
Particulars Amount (Rs.)
Postage & Telephone Exp. 32,565.00
Conveyance & Travelling 3,680.00
Total 36,245.00

11.00 Direct Income – Rs. 39,704.80/-

 Direct income has decreased by Rs. 60.17 Lakhs as compared to period April ’17 to
September ’17 which is mainly because, department has not shown internal transfer
as sales. Previously department was following cost plus profit module, however
from this year department transfers the related cost to respective departments and
branches.

12.00 Indirect Income – Rs. 5,098.00/-

 This amount pertains to amount received from sale of waste paper and damage files.
Indirect income increased by Rs. 0.03 Lakhs as compared to period from April ’17 to
September ’17.

Sanjay Rane & Associates

Chartered Accountants 13
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

Annexures

Annexure 1
Strength of Staff

Particulars No. of employees

Manager 1
Dept. Manager 1
Jr. Sub. Accountant 1
Clerk GRN 1
Majdoor 5
Temporary 2
TOTAL 11

Annexure 2:
Details Old Creditors

Particulars Pending since, Date Amounts (Rs.)

Sahyadri sah.sakhar karkhana ltd November -2013 510.00

Vichi agro products pvt ltd March -2017 6,329.00
Total 6,839.00

Annexure 3:
Details of Excess / Shortage of Stock as on 30.09.2018

Stock as per Stock as per Excess /

Particulars Sales
Stock Sheet Computer (Shortage)
A.B. L14/L16
31,19,008.70 31,24,337.65 (5,328.95) 10,62,009.85
Godown
K.K. Packing 71,9,506.63 7,24,505.37 (4,998.95)
KKT Packing 1,89,208.06 1,98,889.48 (9,681.42)
Total 40,27,723.39 40,47,732.50 (20,009.11)

Annexure 4:
Details of deposits made:
Particulars Amount

Sanjay Rane & Associates

Chartered Accountants 14
Interim Statutory Audit Report Apna Bazar co-op Departmental Store
Half Year Ended- September, 2018 APMC Departmental Store

Deposit 19,000.00
Electricity Deposit 4,790.00
License 10,000.00
Total 33,790.00

Vote of Thanks:
We express our sincere gratitude for the support & co-operation received from the
manager, the staff and local committee members during the course of audit.

Place: Mumbai for Sanjay Rane & Associates

Date: Chartered Accountants

Partner

Sanjay Rane & Associates

Chartered Accountants 15