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Auditor Report of Cerebra Integrated Technologies Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of CEREBRA INTEGRATED TECHNOLOGIES LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit.We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material mis statement. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments; the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, and its loss for the year and its cash flows for the year ended on that date.

Emphasis of Matters

Without qualifying our report, we draw attention to the following matters in the Notes to the financial statements:

a. Share application Money and advance to a wholly owned subsidiary amounting to Rs. 6,73,91,635/- (refer Note 29(11) to account) utilized towards payment of initial deposit for acquisition of company which was aborted subsequently.

b. Capital advances amounting to Rs. 16,98,48,000 (refer Note 29(12) and Trade receivables and advances amounting to Rs. 21,35,10,773 (refer note 29(13) to accounts) outstanding for substantial period, pending recovery/adjustments.

Report on Other Legal and Regulatory Requirements

As required by Section 143 (3) of the Act, we report that:

We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

On the basis of the written representations received from the directors as on 31 st March, 2015 taken on record by the Board of Directors, none of the directors are disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our Information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements.

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts expect on matters stated in emphasis of matter paragraph above.

iii There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

[Referred to in paragraph (1) under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date]

i. a. The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets, on the basis of available information.

b. As explained to us, all the fixed assets were physically verified by the Management in during the year, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

ii. a. As explained to us, inventories were physically verified during the year by the Management at reasonable intervals

b. In our opinion and according to the information and explanation given to us, the procedures of physical verification of inventories followed by the Management were reasonable and adequate in relation to the size of the Company and nature of the business;

c. In our opinion and according to the information and explanation given to us, the Company has maintained proper records of inventories. As explained to us, there were no material discrepancies noticed on physical verification of inventories, compared to the book records.

iii. The Company has granted interest free unsecured advances to four subsidiaries covered in the register maintained under Section 189 of the Act. The maximum amount involved at any time during the period was Rs. 14,52,72,145/- and period end balance was Rs. 14,26,87,142/-

a. As per the information and explanation given to us, there are no terms and conditions attached to these advances. Hence we are not able to express an opinion as to whether the receipt of principal and interest are regular.

b. In respect of the aforesaid loans, we are not able to express an opinion as to whether reasonable steps have been taken by the Company for recovery of principal and interest;

iv. In our opinion and according to the information and explanations given to us, the internal control procedures need to be strengthened to make it commensurate with the size of the company and the nature of its business with regard to purchases of inventory, fixed assets and sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

v. The Company has not accepted any deposits and hence the requirement of clause 3 (v) of Companies (Auditor's Report) Order, 2015 is not applicable to the Company during the year under review.

vi. The Central Government has not prescribed maintenance of cost records under Section 148 (1) of the Act for the products of the Company.

vii. a The Company is generally regular in depositing undisputed statutory dues including provident fund, employees'

state insurance, income-tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues with the appropriate authorities except for income tax, value added tax and excise duty given below:

The amounts outstanding statutory dues of income tax and excise duty, as at the last day of the financial year for a period of more than six months from the date they became payable are as follows

Name of the Nature of Amounts in Period to Statute Dues INR which it relates

Income Tax Income tax 8,99,914 2001-02 Act 1961

Central Excise Excise duty 28,09,259 2002-03 Act,1944

Name of the Due Dates Date of Statute Payment

Income Tax Various Not paid as Act 1961 dates on the date of this report

Central Excise Various Not paid as Act,1944 dates on the date of this report

b. According to the information and explanation given to us, there are no disputed dues of income tax or sales tax or wealth tax or service tax or duty of customs or duty of excise or value added tax or cess which have not been deposited with the relevant authorities on account of any dispute.

c. According to the information and explanation given to us, the amount required to be transferred to investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under has been transferred to such fund within time.

viii. The accumulated losses of the Company did not exceed 50% of the net worth of the Company at the end of the financial period. The Company has incurred cash losses during the financial period covered by our audit and has not incurred cash loss in the immediately preceding financial period.

ix. Based on our audit procedures and on the information and explanations given by the management, the Company has not defaulted in repayment of dues to banks. The Company did not have any dues to financial institutions & debenture holders.

x. As far as we could ascertain, the Company has not given guarantees for loans taken by others from banks or financial institutions. Accordingly the provisions of clause 3(x) of the Companies (Auditor's Report) Order, 2015 are not applicable to the company.

xi. In our opinion and according to the information and explanation given to us the term loans were applied for the purpose for which the loan was obtained.

xii. According to the information and explanations given to us, no frauds on or by the Company that causes material misstatements to financial statements have been noticed or reported during the period.

For Ishwar & Gopal, Chartered Accountants, Firm's Registration Number : 001154S

K V Gopalakrishnayya Partner Membership Number: 021748 Place : Bangalore Date : 29.05.2015


Mar 31, 2014

1 We have audited the accompanying financial statements of Cerebra Integrated Technologies Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2014, and the Statement of Profit and Loss and Cash Flow Statement for the period then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

2 Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 ("the Act") read with the General Circular 15 / 2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

3 Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

4 An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

5 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

6. Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a. in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

b. in the case of the Profit and Loss Account, of the profit for the period ended on that date; and

c. in the case of the Cash Flow Statement, of the cash flows for the period ended on that date.

Emphasis of Matter

7 Without qualifying our report, we draw attention to:

a. Share application Money and advance to a wholly owned subsidiary amounting to Rs.6,73,91,635/-(refer Note 2 B (11) to account) utilized towards payment of initial deposit for acquisition of company which was aborted subsequently.

b. Capital advances amounting to Rs 16,98,48,000 (refer Note 2B(12) and Trade receivables and advances amounting to Rs 10,46,07,626 (refer note 2B(13) to accounts) outstanding for substantial period ,pending recovery/adjustments.

Report on Other Legal and Regulatory Requirements

8 As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

9. As required by section 227(3) of the Act, we report that:

a. we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b. in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.

c. the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards notified under the Companies Act, 1956 read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013;

e. on the basis of written representations received from the directors as on March 31, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO AUDITORS'' REPORT AS REFERRED TO IN CLAUSE 9 OF OUR REPORT TO THE MEMBERS OF CEREBRA INTEGRATED TECHNOLOGIES LIMITED

i. a. The Company has maintained records showing full particulars, including quantitative details and the situation of its fixed assets on the basis of available information.

b. All the assets have not been physically verified by the management during the period but there is a program of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its business. According to the information and explanation given to us, no discrepancies were noticed on such verification.

c. During the period under review, the Company has not disposed off substantial part of the assets and the going concern status of the Company is not affected.

ii. a. Inventories were physically verified during the period by the management. In our opinion, the frequency of verification is reasonable;

b. In our opinion and according to the information and explanations given to us the procedures for physical verification of inventory followed by the management were reasonable and adequate in relation to the size of the Company and the nature of its business;

c. The discrepancies between the physical stocks and the book records arrived at on an annual reconciliation, wherever applicable, as noticed on physical verification were not material and have been properly dealt with in the books of account.

iii. a. According to information and explanation given to us, the Company has granted interest free unsecured advances to four subsidiaries covered in the register maintained under section 301 of the Companies Act 1956. The maximum amount involved at any time during the period was Rs. 16,25,56,241/-and period end balance was Rs. 16,25,56,241/-.

b. As per the information and explanation given to us, there are no terms and conditions attached to these loans. Hence we are not able to express an opinion as to whether the terms and conditions on which the said advances have been granted by the Company are prima facie, prejudicial to the interest of the Company.

c. As per the information and explanation given to us, there are no stipulations as to repayment of principal or interest, we are not able to express an opinion as to whether the payment of principal and interest was regular;

d. In respect of the aforesaid loans, we are not able to express an opinion as to whether reasonable steps have been taken by the Company for recovery of principal and interest;

The Company has not taken loans from companies, firms and other parties covered in the register maintained under section 301 of the Companies Act, 1956. Hence clause 4 (iii) (e) to (g) of the Companies Auditor''s Report Order, 2003 (as amended) is not applicable to the Company for the period under review.

iv. In our opinion and according to the information and explanations given to us, the internal control procedures need to be strengthened to make it commensurate with the size of the company and the nature of its business with regard to purchases of inventory, fixed assets and sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

v. a According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us, there are no transactions made in pursuance of such contracts and arrangements and exceeding the value of Rs. Five Lakhs in respect of any party during the period. Accordingly, the provisions of clause 4(v)(b) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

vi The Company has not accepted any deposits from public and hence the provisions of section 58A and 58AA of the companies Act, 1956 and rules framed there under during the period under review. We have been informed that no order has been passed by the Company Law Board.

vii In our opinion, the Company''s internal audit system needs to be strengthened to make it commensurate with the size and nature of its business.

viii. The Central Government has not prescribed maintenance of cost records under Section 209 (1) (d) of the Companies Act, 1956 for the products of the Company.

ix. a. The Company has been regular in depositing with the appropriate authorities undisputed statutory dues including provident fund, employees'' state insurance, income tax, sales tax, wealth tax, customs duty and other material statutory dues applicable except as detailed in clause (b) below.

b According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, customs duty and cess were in arrears as at March 31, 2014 for a period of more than six months from the date they became payable except for sales tax and excise duty.

Name of the Statute Nature of the dues Amounts in INR Period to which it relates

Income Tax Act, 1961 Income tax 899,914 2001-02

Central Excise Act, Excise Duty 28,09,259 2002-2003 1944

The Maharashtra Value Sales tax 5,61,421 2010-11 to Added Tax Act, 2002 2012-13



Name of the Statute Due Date Date of Payment

Income Tax Act, 1961 Various dates Not paid as on the date of this report

Central Excise Act, 1944 Various dates Not paid as on the date of the report

The Maharashtra Value Added Various dates Not paid as on the date Tax Act, 2002 of this report

c. According to the information and explanation given to us, there are no disputed dues of income tax, wealth tax, customs duty, sales tax, excise duty and cess which have not been deposited with the relevant authorities on account of any dispute.

x. The accumulated losses of the Company did not exceed 50% of the net worth of the Company at the end of the financial period. The Company has not incurred cash losses during the financial period covered by our audit and in the immediately preceding financial period.

xi Based on our audit procedures and on the information and explanations given by the management, the Company has not defaulted in repayment of dues to financial institutions / banks / debenture holders.

xii The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Accordingly, clauses 4(xii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

xiii. In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/ society. Accordingly, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

xiv. In our opinion the Company is not dealing in or trading in shares, securities, debentures and other investments during the period under audit. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

xv. As far as we could ascertain, the Company has not given guarantees for loans taken by others from banks or financial institutions. Accordingly the provisions of clause 4(xv) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

xvi. In our opinion and according to the information and explanation given to us the Company has not availed any term loans during the period under review.

xvii. According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long-term investment.

xviii.According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties listed in the register maintained under section 301 of the Companies Act, 1956. Accordingly the provisions of clause 4(xviii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the company.

xix According to the information and explanations given to us, the Company has not issued any debentures. Accordingly, the provisions of clause 4(xix) of the Companies (Auditor''s Report) Order, 2003 regarding creation of securities are not applicable.

xx The Company has not raised any monies by way of public issue during the period. Accordingly, the provisions of paragraph 4(xx) of the Companies (Auditor''s Report) Order, 2003 regarding end use of money are not applicable.

xxi According to the information and explanations given to us, no frauds on or by the Company that causes material misstatements to financial statements have been noticed or reported during the period.

for Ishwar & Gopal, Chartered Accountants Firm''s Registration Number : 001154S

K V Gopalakrishnayya Partner Membership Number 021748 Place of Signature : Bangalore Date: 29.05.2014


Sep 30, 2013

Report on the Financial Statements

1 We have audited the accompanying financial statements of Cerebra Integrated Technologies Limited ("the Company"), which comprise the Balance Sheet as at September 30, 2013, the Statement of Profit and Loss for the year then ended, Cash Flow Statement for the year ended on that date and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

2 Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

3 Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

4 An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

5 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

6 In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India subject to

a. in the case of the Balance Sheet, of the state of affairs of the Company as at September 30, 2013 and

b. in the case of the Statement of Profit and Loss Account, of the profit for the year ended on that date;

c. In the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Emphasis of Matter

W e invite attention in respect of : (i) Share Application Money and advance to a wholly owned subsidiary amounting to Rs. 6,79,76,747/- (refer Note 2B (k) to account) utilized towards payment of initial deposit for acquisition of a Company which was cancelled subsequently.(ii) Capital advances amounting to Rs. 16,98,48,000 (refer Note 2B (l) and (iii) Trade receivables amounting to Rs 7,54,70,660 (refer Note 2B (m) to accounts) outstanding for substantial period, pending recovery / adjustments. Our opinion is not qualified in respect of these matters.

Report on Other Legal and Regulatory Requirements

7 As required by the Companies (Auditor''s Report) Order, 2003, (the Order) (as amended) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

8. As required by section 227(3) of the Act, we report that:

a. we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b. in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.

c. the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this Report are in agreement with the books of account

d. in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in sub section (3C) of section 211 of the Companies Act, 1956;

e. On the basis of written representations received from the directors as on September 30, 2013, and taken on record by the Board of Directors, none of the directors are disqualified as on September 30, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO THE AUDITOR''S REPORT OF EVEN DATE TO THE MEMBERS CEREBRA INTEGRATED TECHNOLOGIES LIMITED i. Fixed Assets

a. The Company has maintained records showing full particulars, including quantitative details and the situation of its fixed assets;

b. The fixed assets have been physically verified by the management during the year according to a periodical phased program. In our opinion, the frequency of verification of the fixed assets by the management is reasonable having regard to the size of the Company and the nature of its assets. According to the information and explanation given to us, no discrepancies noticed have been properly dealt with in the books of account;

c. During the year, substantial part of the assets has not been disposed off by the Company.

ii. Inventory

a. According to the information and explanation given to us, the inventory has been verified by the management at reasonable intervals;

b. In our opinion and according to the information and explanation given to us, the procedures for physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

c. According to the information and explanation given to us, the Company has maintained records of inventory. We have been informed that the discrepancies noticed on verification between physical stocks and book stocks were not material and have been dealt with.

iii. a. According to the information and explanation given to us, the Company has granted interest free unsecured advances to four subsidiaries covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved at any time during the year was Rs. 13,21,35,407/- and year end balance was Rs. Rs. 13,21,35,407/-b. In our opinion, since there are no terms and conditions for recovery of these advances we are not able to express any opinion as to whether the terms and conditions are not prima facie prejudicial to the interest of the Company

c. In our opinion, since there are no terms and conditions for recovery of these advances we are not able to express any opinion on regularity of repayment of principal amount. d. The Company has not taken any loans from parties covered in the register maintained under Section 301of the Companies Act, 1956. Hence, the requirement of clause 4 (iii) (d) to (g) of the Companies (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company in the year under review

i v In our opinion and according to the information and explanations given to us, the internal control procedures are to be strengthened to make it commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and with regard to the sale of goods. According to information and explanations given to us, there is no continuing failure to correct major weaknesses in the system.

v a. According to the information and explanations given to us, we are of the opinion that, during the year under audit, the transactions that need to be entered in the register maintained under Sec 301 of the Companies Act, 1956 have been entered. b. in our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts and arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of Rupees five lakhs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

vi. The Company has not accepted any deposits under the provisions of section 58A, 58AA or any other provisions of the Act and the rules framed there under;

vii. In our opinion, the internal audit systems of the Company need to be strengthened to make it commensurate with the size of the Company and the nature of its business.

viii. According to the information and explanations given to us, the Central Government has not prescribed maintenance of cost records under section 209(1) (d) of the Companies act, 1956 for the Company.

ix The company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, and Excise Duty applicable to it except for Income Tax and Excise Duty.

c. According to the information and explanation given to us and as per the records of the Company examined by us, there are no disputed amounts of sales tax, income tax, excise duty, service tax, customs duty as at September 30, 2013, which have not been deposited on account of pending dispute

x The accumulated losses at the end of the financial year is less than fifty percent of its net worth. The Company has not incurred cash losses during the financial year under review and the immediately preceding financial year.

xi. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks during the year under review. There are no dues to financial institutions / debenture holders

xii According to the information and explanation given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

xiii In our opinion, the company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore the provisions of clause 4 (xiii) of the companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

xi v In our opinion and according to the information and explanations given to us, there were no transactions and contracts in respect of dealing or trading in shares, securities and other investments. Investments have been held by Company in its own name.

xv. According to the information and explanation given to us, the Company has not given guarantee for loans taken by others from banks or financial institutions.

xvi. According to the information and explanation given to us, the Company has not taken any term loan during the year under review

xvii.According to the information and explanations given to us and on an overall examination of the balance sheet of the company, during the year under audit, we report that the funds raised on short term basis have not been used for long term investment. No long term funds have been used to finance short term assets.

xviii.According to the information and explanations given to us, the Company has not made preferential allotment of shares to parties covered in the register maintained under section 301of the Companies Act, 1956. Therefore the provisions of clause 4 (xviii) of the companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

xix. According to the information and explanations given to us, Company has not issued debentures.

xx. During the year under review, the Company has not raised money by public issue.

xxi. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year.

for Ishwar & Gopal,

Chartered Accountants

K. V. Gopalakrishnayya

Partner

Membership No.: 021748

Firm Registration No.: 001154S

Place: Bangalore

Date: 30.11.2013


Sep 30, 2010

1. We have audited the attached balance sheet of CEREBRA INTEGRATED TECHNOLOGIES LIMITED as at 30th September 2010 and Profit and Loss Account for the year ended on the date, annexed thereto. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Furtherto our comments in the Annexure referred to above, we report that:

(i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;

(ii) In our opinion, proper books of account as required by law have been kept by the company so for as appears from our examination of those books.

(iii) The balance sheet, profit and loss account and cash flow statement dealt with by this report are in agreement with the books of account;

(iv) In our opinion, the balance sheet, profit and loss account and cash flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the companies Act, 1956 subject to no/7 provision for gratuity and leave encashment salary benefits of employees on accrual basis;

(v) On the basis of written representations received from the directors as on 30th September 2010 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 30h September 2010 from being appointed as a director in terms of clause (g) of sub section (1) of section 274 oftheCompaniesAct, 1956;

(vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India subject to:

a. That as on March 31st 2010, the company has debtors/advances outstanding amounting to Rs.4,22,01,922/- on which we are unable to comment on the extent of recoverability of the aforesaid amounts. Management has represented that it is of the opinion that the debtors/advances are fully recoverable.

b. Non provision for gratuity and leave encashment salary benefits of employees on accrual basis which is not quantified by the management.

c. Pending Confirmation and reconciliation of Sundry Debtors, Creditors and advances as per 8 notes to accounts.

i. in the case of the balance sheet, of the state of affairs of the company as at 30"> September 2010;

ii. in the case of the profit and loss account, of the profit for the year ended on that date; and

iii. in the case of the cash flow statement, of the cash flows for the year ended on that date:

Annexure Cerebra Integrated Technologies Limited. Referred to in paragraph 3 of our report of even date, to the members of Cerebra Integrated Technologies Limited, Bangalore on the accounts for the year ended 30 September 2010.

(i) (a) The company has maintained proper records showing particulars including quantitative details and situation of fixed assets and is to be updated. According to the information and explanations given to us, the programme of verification of fixed assets, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets.

(b) During the period under audit, the company has not disposed off substantial portion of the fixed assets.

(ii) (a) According to the information and explanations given to us, the inventory has been physically verified by the management. In our opinion, the frequency of verification is to be increased.

(b) In our opinion and according to information and explanations given to us, the procedures of physical verification of inventories followed by the management are adequate in relation to the size of the company and the nature of its business.

(c) According to the information and explanations given, the company is maintaining proper records of inventory. We are informed that the discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) (a) According to information and explanations given to us, the company has taken advance from four parties listed in the register maintained us 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs 11.86 Lacs and the year end balance of advance received from such parties was Rs.10.86Lacs.

(b) According to information and explanations given to us, the company has granted unsecured loan to one company listed in the register maintained u/s 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 130.63 Lacs and the year end balance of loan granted to such party was Rs. 130.63 Lacs.

(c) According to information and explanation given to us, no interest paid / payable in respect of advances received from the parties listed in register maintained u/s 301 of the Companies Act, 1956. No interest was charged in respect of Unsecured Loan given by the Company to the Borrower Company.

(d) The payment of principal and interest in respect of unsecured loan given are not regular.

(e) During the year, the Company has not provided for bad debts amounting to Rs.9.50 lacs in respect of loan given to the Company Listed in the register maintained u/s 301 of The Companies Act, 1956

(iv) In our opinion and according to the information and explanations given to us, the internal control procedures are to be strengthened commensurate with the size of the company and the nature of its business for the purchase of inventory, fixed assets and with regard to the sale of goods. According to information and explanations given to us, there is no continuing failure to correct major weaknesses in the system.

(v) (a) According to the information and explanations given to us, during the year under audit, the transactions that need to be entered in those registers pursuantto Sec 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, no transactions were made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the companies Act 1956 and exceeding the value of rupees five Lakhs in respect of any party during the year.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted deposits from public.

(vii) In our opinion and according to the information and explanations given to us, the scope of internal audit is to be increased commensurate with the size of the company and the nature of its business.

(viii) According to the information and explanations given to us, the Central Government has not prescribed maintenance of cost records under section 209(1) (d) of the companies act, 1956 for the company.

(ix) (a) The company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, and Excise Duty applicable to it. The arrears of outstanding statutory dues as at 30.09.10 for a period more than six months from the date they became payable are given below:

Rs.

Income Tax Payable 368,635/-

Sales Tax Payable 184,899/-

Excise Duty 2,809,259/-

Professional Tax 109,773/-

(b) According to the information and explanation given to us, the Sales Tax dues amounting to Rs 9,24,282/- have not been deposited on account of appeal pending at Karnataka State Tribunal and Income Tax demand of Rs.15,99,914/- on account of pending approval of BIFR scheme.

(x) The company has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year. The net worth of the company is positive as at the year end. The accumulated losses of the company are more than fifty percent of its net worth.

(xi) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to Banks as at the year end.

(xii) According to the information and explanation given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the company is not a chit fund or a nidhilmutuabenefit fund/society. Therefore the provisions of clause 4 (xiii) of the companies (Auditors Report) Order, 2003 are not applicable to the company.

(xiv) In our opinion and according to the information and explanations given to us, there were no transactions and contracts in respect of dealing or trading in shares, securities and other investments. Investments have been held by company in its own name.

(xv) According to the information and explanation given to us, the company has not given guarantee for loans taken by others from banks or financial institutions.

(xvi) According to the information and explanation given to us, the company has not raised any term loans during the period under the audit.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, during the year under audit, we report that the funds raised on short term basis have not been used for long term investment. No long term funds have been used to finance short term assets.

(xviii) According to the information and explanations given to us, the company has made preferential allotment of shares to parties covered in the register maintained under section 301 of the Companies Act, 1956. In our opinion, the price at which shares have been issued is not prejudicial to the interest of the Company.

(xix) According to the information and explanations given to us, during the period covered by our audit report, the company had not issued any debentures.

(xx) During the period underaudit, the company has not raised money by public issue.

(xxi) According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

For M.S.Reddy & Associates

Chartered Accountants Firm Registration No. 007992S

Date: 29.11.2010 M. SRIDHAR REDDY

Place: Bangalore. Partner.

Membership Number 201103




Sep 30, 2009

1. We have audited the attached balance sheet of CEREBRA INTEGRATED TECHNOLOGIES LIMITED as at 30th September 2009 and Profit and Loss Account for the year ended on the date, annexed thereto. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to above, we report that:

(i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;

(ii) In our opinion, proper books of account as required by law have been kept by the company so for as appears from our examination of those books.

(iii) The balance sheet, profit and loss account and cash flow statement dealt with by this report are in agreement with the books of account;

(iv) In our opinion, the balance sheet, profit and loss account and cash flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the companies Act, 1956;

(v) On the basis of written representations received from the Directors, as on 30th September 2009 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 30th September 2009 from being appointed as a Director in terms of clause (g) of sub section (1) of section 274 of the Companies Act, 1956;

(vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

(a) in the case of the Balance Sheet, of the state of affairs of the company as at 30lh September 2009;

(b) in the case of the Profit and Loss Account, of the profit for the year ended on that date; and

(c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date subject to:

a. In our opinion, the debtors and advances amounting to Rs.5,38,42,469/- are doubtful for which no provision is made.

b. Sundry Debtors, Creditors and advances are subject to confirmation and reconciliation

Annexure to Auditors Report

Referred to in paragraph 3 of our report of even date, to the members of Cerebra Integrated Technologies Limited, Bangalore on the accounts for the year ended 30 September 200J.

(i) (a) The company has maintained proper records showing particulars including quantitative details and situation of fixed assets and is to be updated. According to the information and explanations given to us, the programme of verification of fixed assets, which in our opinion, is to be strengthened having regard to the size of the company and the nature of its assets. (b) During the period under audit, the company has not disposed off substantial portion of the fixed assets

(ii) (a) According to the information and explanations given to us, the inventory has not been physically verified by the management.

(b) In our opinion and according to information and explanations given to us, the procedures of physical verification of inventories followed by the management are not adequate in relation to the size of the company and the nature of its business.

(c) According to the information and explanations given, the company is not maintaining proper records of inventory. We are informed that the discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) (a) According to information and explanations given to us, the company has taken advance from four parties listed in the register maintained us 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 12.99 lakhs and the year end balance of advance received from such parties was Rs.11.86 Lacs.

(b) According to information and explanations given to us, the company has granted unsecured loan to one company listed in the register maintained us 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.141.14 Lacs and the year end balance of loan granted to such party was Rs.123.14 Lacs.

(c) According to information and explanation given to us, no interest paid / payable in respect of advances received from the parties listed in register maintained u/s 301 of the Companies Act, 1956. No interest was charged in respect of Unsecured Loan given by the Company to the Borrower Company.

(d) The payment of principal and interest in respect of unsecured loan given are not regular.

(e) During the year, the Company has not provided for bad debts amounting to Rs.2.00 lacs in respect of loan given to the Company Listed in the register maintained u/s 301 of The Companies Act, 1956

(iv) In our opinion and according to the information and explanations given to us, the internal control procedures are to be strengthened commensurate with the size of the company and the nature of its business for the purpose of inventory and fixed assets and for sale of goods. According to information and explanations given to us, there is no continuing failure to correct major weaknesses in the system.

(v) (a) According to the information and explanations given to us, during the year under audit, the transactions that need to be entered in those registers pursuant to Sec 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, no transactions were made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the companies Act 1956 and exceeding the value of rupees five Lakhs in respect of any party during the year.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted deposits from public.

(vii) In our opinion and according to the information and explanations given to us, the scope of internal audit is to be increased commensurate with the size of the company and the nature of its business.

(viii) According to the information and explanations given to us, the Central Government has not prescribed maintenance of cost records under section 209(1)(d) of the companies act,1956 for the company.

(ix) (a) The company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Excise Duty applicable to it. The arrears of outstanding statutory dues as at 30.9.09 for a period more than six months from the date they became payable are given below:

Income Tax Payable 368,635/-

Sales Tax Payable 184,899/-

Excise Duty 2,809,259/-

Professional Tax 74,723/-

(b) According to the information and explanation given to us, the Sales Tax dues amounting to Rs.9,24,282/- have not been deposited on account of appeal pending at Kamataka State Tribunal and Income Tax demand of Rs. 15,99,914/- on account of pending approval of BIFR scheme. (x) The company has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year. The net worth of the company is positive as at the year end. The accumulated losses of the company are more than fifty percent of its net worth.

(xi) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to Banks as at the year end.

(xii) According to the information and explanation given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the company is not a chit fund or a n/dh//mutual benefit fund/society. Therefore the provisions of clause 4 (xiii) of the companies (Auditors Report) Order, 2003 are not applicable to the company.

(xiv) In our opinion and according to the information and explanations given to us, there were no transactions and contracts in respect of dealing or trading in shares, securities and other investments. Investments have been held by company in its own name.

(xv) According to the information and explanation given to us, the company has not given guarantee for loans taken by others from banks or financial institutions.

(xvi) According to the information and explanation given to us, the company has not drawn term loans during the period under the audit.

(xvii)According to the information and explanations given to us and on an overall examination of the balance sheet of the company, during the year under audit, we report that the funds raised on short term basis have not been used for long term investment. No long term funds have been used to finance short term assets.

(xviii)According to the information and explanations given to us, the company has made preferential allotment of shares to parties covered in the register maintained under section 301 of the Companies Act, 1956. In our opinion, the price at which shares have been issued is not prejudicial to the interest of the Company.

(xix) According to the information and explanations given to us, during the period covered by our audit report, the company had not issued any debentures.

(xx) During the period under audit, the company has not raised money by public issue.

(xxi) According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.



for M.S.REDDY & ASSOCIATES Chartered Accountants Date: 30.11.2009 M.SRIDHAR REDDY Place: Bangalore. Partner Membership No. 201103

 
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