We have synthesized graphene-oxide (GO) by the modified hummer's process and subsequently reduced it with gold-nanoparticles (Au-NPs) using silica coated colloidal Au-NPs and hydrazine monohydrate solutions to form r-GO: Au-NPs nanocomposites. We have studied the microstructure, electronic, electrical and magnetic properties of r-GO and r-GO: Au-NPs nanocomposites. We have observed from the Raman spectroscopy that the intensity of D-peak (disorder) gets reduced with respect to G (graphite-cluster) in r-GO: Au-NPs composites. The reduction of I-D/I-G ratio obtained from Raman spectra [r-GO: 1.22 -> r-GO:(Au-NPs) 4.88: 0.98] clearly indicates that the sp(2) cluster is reduced in r-GO: Au-NPs nanocomposites. The reduction of sp(2)-cluster and/or enhancement of sp(3) cluster is due to replacement of sp(2)-cluster by the Au-NPs. This observation also observed from the X-ray absorption near edge structure (XANES) spectroscopy, X-ray photoelectron spectroscopy (XPS) measurements that are consistence with reduction of conductivity as we observe from the current (I)-voltage (V) characteristics of the nanocomposites. Magnetic M-H hysteresis loops show the magnetization is enhanced in r-GO: Au-NPs nanocomposites. We believe that the reduction of conductivity and enhancement of magnetization of r-GO: Au nanocomposites would be most suitable for ferro-electro-magnetic materials for the memory storage device applications.