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Auditor Report of Fortune Financial Services (India) Ltd.

Mar 31, 2016

To the Members of

Fortune Financial Services (India) Limited Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of Fortune Financial Services (India) Limited (''the Company''), which comprise the balance sheet as at March 31, 2016, the statement of profit and loss and the cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Standalone 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 and presentation of these standalone 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 ("the Rules"). This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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 standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these standalone 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 and the Order under section 143(11) of the Act.

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 standalone financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the standalone 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 standalone 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 standalone 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:

a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2016;

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

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

Emphasis of matter

We draw attention to Note 29 to the standalone Financial Statements. As referred to in the said note, The Scheme of Amalgamation ("Scheme") between ITI Wealth Management Private Limited ("Transferor Company") and Fortune Financial Services (India) Limited ("Transferee Company") with effect from "appointed date" of 1st January, 2016 is awaiting approval of High Court of Bombay and Chennai under section 391 to 394 of the companies Act, 1956 and to the extent applicable, provisions of the Companies Act, 2013. As the approval of Hon''ble High Court of Bombay and Chennai is awaited thus the amalgamation though effective from "appointed date" 1st January, 2016 i.e. shall be operative from "effective date" i.e. the last of dates on which all the consents and approvals referred to in the Scheme are obtained or waived. As approvals & sanctions of the Scheme from the Hon''ble High Court of Bombay and Chennai are pending, Company''s accounts have been prepared independently without giving effect of the Scheme. The effect of the above amalgamation will be given in the Annual Accounts of the Company, in the Financial Year in which all the sanctions or orders as specified in the Scheme of Amalgamation are obtained and/or filled.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure A, a statement on the matters specified in the paragraph 3 and 4 of the Order, to the extent applicable.

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

a. 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;

b. In our opinion proper books of account as required by law relating to preparation of the standalone financial statements have been kept by the Company so far as it appears from our examination of those books;

c. The balance sheet, the statement of profit and loss and the cash flow statement dealt with by this Report are in agreement with the books of account maintained for the purpose of preparation of these standalone financial statements;

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

e. On the basis of the written representations received from the directors as on March 31, 2016, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2016, from being appointed as a director in terms of Section 164 (2) of the Act;

f. with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure B"; and

g. 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 standalone financial statements.

ii. The Company does not have any long term contracts including derivative contracts for which there were any material foreseeable losses.

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

Annexure - A to the Independent Auditors'' Report

(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date for the year ended March 31, 2016)

Report on Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of Section 143(11) of the Companies Act, 2013 ("the Act") of the Company.

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

b. The Company has a regular programme of physical verification of its fixed assets by which all the assets have been physically verified by the management during the year at regular intervals which in our opinion 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 material discrepancies were noticed on such verification.

c. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the company does not have any immovable properties. Accordingly Paragraph 3(i) (c) of the order is not applicable.

ii. The Company is a service company, primarily rendering financial advisory and consultancy services. Accordingly, it does not hold any physical inventories. Thus, paragraph 3(ii) of the Order is not applicable to the Company.

iii. The Company has granted unsecured loans to three Companies covered in the register maintained under section 189 of the Companies Act, 2013 (''the Act'').

a. In our opinion, the rate of interest and other terms and conditions on which the loans had been granted to the Companies listed in the register maintained under Section 189 of the Act were not, prima facie, prejudicial to the interest of the Company

b. In the case of the loans granted to the Companies listed in the register maintained under section 189 of the Act, the borrowers have been regular in the payment of the principal and interest as stipulated.

c. There are no overdue amounts in respect of the loan granted to the Companies listed in the register maintained under section 189 of the Act.

iv. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 185 and 186 of the Act, with respect to grant of loans, making investments and providing guarantees and securities, as applicable.

v. The Company has not accepted any deposits from the public during the year, within the meaning of sections 73 to 76 of the Act or any other relevant provisions of the Act and the rules framed there under and therefore, provisions of paragraph 3(v) of the Order is not applicable to the Company.

vi. The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Act, for any of the services rendered by the Company.

vii. a. According to the information and explanations given to us, the Company has generally been regular in depositing undisputed statutory

dues including provident fund, employees'' state insurance, income-tax, service tax, cases and other material statutory dues as applicable to the Company. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees'' state insurance, income-tax, service tax, cases and other material statutory dues as applicable were in arrears as at 31 March 2016 for a period of more than six months from the date they became payable.

b. According to the information and explanations given to us, there are no dues of sales tax, service tax, duty of customs, duty of excise or value added tax, as applicable which have not been deposited as at March 31, 2016 with appropriate authorities on account of any dispute. Details of Income Tax which have not been deposited as at 31 March 2016 on account of dispute are given below:

Name of the statute

Nature of dues

Amount (in lakhs)

Period for which the amount relates

Forum where the dispute is pending

Income tax Act, 1961

Income Tax

7.46

2012-13

Commissioner of Income Tax (Appeals)

Income tax Act, 1961

Income Tax

53.07

2011-12

Income Tax Appellate Tribunal

viii. The Company does not have any loans or borrowings from any financial institution, banks, government or debenture holders during the year. Accordingly, paragraph 3(viii) of the Order is not applicable.

ix. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, paragraph 3 (ix) of the Order is not applicable.

x. To the best of our knowledge and according to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the year.

xi. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.

xii. The Company is not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.

xiii. According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the standalone financial statements as required by the applicable accounting standards.

xiv. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year and hence reporting under paragraph 3(xiv) of the Order is not applicable.

xv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

xvi. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.

Annexure - B to the Independent Auditors'' Report

(Referred to in paragraph 2(f) under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date for the year ended March 31, 2016)

Report on the Internal Financial Controls over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")

We have audited the internal financial controls over financial reporting of Fortune Financial Services (India) Limited ("the Company") as of 31 March 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (the ''Guidance Note''). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors'' Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that:

(1) Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and

(3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at

31 March 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note.

For Bathiya& Associates LLP

Chartered Accountants

Firm Registration No. 101046W / W100063

Umesh B. Lakhani

Partner

Membership No. : 044981

Place : Mumbai

Date : May 24, 2016


Mar 31, 2015

We have audited the accompanying standalone financial statements of Fortune Financial Services (India) Limited ('the Company'), which comprise the balance sheet as at March 31, 2015, the statement of profit and loss and the cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone 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 and presentation of these standalone 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 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 standalone 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 thereunder.

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 misstatement.

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, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. 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 standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone 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 March 31,2015, and its profit and its cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in the paragraph 3 and 4 of the Order, to the extent applicable.

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

a. 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.

b. 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;

c. The balance sheet, the statement of profit and loss and the cash flow statement dealt with by this Report are in agreement with the books of account;

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

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

f. 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 as referred to in note 26 to the financial statements.

ii. The Company does not have any long term contracts including derivative contracts for which there were any material foreseeable losses.

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

Annexure to the Independent Auditors' Report

Referred to in paragraph 1 of the Auditors' Report on "Other Legal & Regulatory Requirements" of even date to the members of Fortune Financial Services (India) Limited on the financial statements as of and for the year ended on March 31,2015.

i. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets by which all the assets have been physically verified by the management during the year at regular intervals which in our opinion is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

ii. The Company is a primarily engaged in business of financial advisory and consultancy services. Accordingly, it does not hold any physical inventories. Thus, paragraph 3(ii)(a), 3(ii)(b) & 3(ii)(c) of the Order are not applicable.

iii. The Company has granted unsecured loans to four bodies corporate covered in the register maintained under section 189 of the Companies Act, 2013 ('the Act').

(a) In respect of aforesaid loans, the parties are repaying the principal amounts, as stipulated, and are also regular in payment of interest as applicable.

(b) There are no overdue amounts of more than rupees one lakh in respect of the loans granted to the bodies corporate listed in the register maintained under section 189 of the Act.

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for purchase of fixed assets and sale of services. The activities of the Company do not involve purchase of inventory and the sale of goods. Further on the basis of examination of books and records of the company, and according to the information and explanations given to us, we have neither come across, nor have been informed of, any continuing failure to correct major weaknesses in the aforesaid internal control system.

v. The Company has not accepted any deposits from the public during the year, within the meaning of directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under. Moreover, no order has been passed by Company Law Board or National Company Law Tribunal or Reserve Bank of India or any other court or tribunal.

vi. The Central Government has not specified maintenance of cost records under sub-section (1) of section 148 of the Act, for any of the services rendered by the Company.

vii. (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, in our opinion, the Company is generally regular in depositing undisputed statutory dues including provident fund, income tax, wealth tax, service tax, and other material statutory dues, as applicable, with the appropriate authorities though there has been slight delay in few cases. As explained to us, the Company does not have any dues on account of duty of customs, sales tax, value added tax, employees state insurance and duty of excise.

(b) According to the information and explanations given to us and on the basis of our examination of the records of the Company, in our opinion, the particulars of dues of income tax at balance sheet date which have not been deposited on account of any dispute are as follows;

Name of the statute Nature of dues Amount (Rs. in lakhs)

Income tax act, 1961 Income Tax 12.36

Income tax act, 1961 Income Tax 25.61

Name of the statute Period for which the Forum where the amount relates dispute is pending

Income tax act, 1961 2010-11 CIT(A), Mumbai

Income tax act, 1961 2011-12 CIT(A), Mumbai

According to the information and explanations given to us and on the basis of our examination of the records of the Company, in our opinion, there were no dues of provident fund, wealth tax, service tax, or cess as at balance sheet date which have not been deposited on account of any dispute.

(c) There were no amount required to be transferred to Investor Education and Protection Fund in accordance with the provision of the Act, and rules made there under.

viii. The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

ix. The Company did not have any outstanding dues to financial institutions, banks or debenture holders during the year.

x. In our opinion and according to the information and the explanations given to us, the terms and condition of the guarantees given by the company for loans taken by its subsidiaries from banks or financial institutions during the year are not in prejudicial to the interest of the company.

xi. The Company did not have any term loans outstanding during the year.

xii. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the company, noticed or reported during the year, nor have we been informed of any such cases by the management.

For S. H. Bathiya & Associates LLP Chartered Accountants ICAI FRN: 101046W / W100063

Umesh B. Lakhani Partner Membership No. : 044981

Place : Mumbai Date : May 12, 2015.


Mar 31, 2014

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

Management''s Responsibility for the Financial Statements

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 Ministry of Corporate affairs in respect of section 133 of 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

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.

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 entity''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 effectiveness of entity''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.

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

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 loss 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.

Report on Other Legal and Regulatory Requirements

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

2. 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 ("the Act") read with the general circular 15/2013 dated 13th September, 2013 of Ministry of Corporate affairs in respect of section 133 of 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 Section 274(1)(g) of the Act;

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Act nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT

Annexure referred to in Paragraph 1 under the heading "Report on Other legal and Regulatory Requirements" of our Report of even date.

On the basis of such checks as we considered appropriate and in our opinion and according to the explanations given to us, we report as under:

1. a. The Company has maintained proper records showing full particulars including quantitative details and situations of fixed assets.

b. The Management has not physically verified its fixed assets during the year.

c. Based on the information and explanations given by the Management and on the basis of audit procedures performed by us, Company has not sold any asset during the year.

2. a. In our opinion and according to the explanations given to us, the Company has granted unsecured loans to three companies covered in the register maintained under Section 301 of the Act. The maximum amount outstanding in respect of the loans given during the year was Rs. 2,642.58 lakhs and the year end balance of such loans is Rs. 2,224.73 lakhs.

b. In our opinion, the rate of interest, and other terms and conditions of the loan granted to the company covered in the Register maintained under Section 301 of the Act are not prima facie prejudicial to the interests of the Company.

c. The receipt of principal and interest is regular, wherever there are stipulations with respect to the same.

d. There is no amount overdue in respect of the loans granted by the Company.

e. The Company has taken loan from a company covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount of the loan taken during the year was Rs.811.46 lakhs and the yearend balance of such loan is Rs. 413.81 lakhs.

f. The repayment of principal and interest is regular wherever there are stipulations with respect to the same.

3. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and for the sale of services. Further on the basis of our examination and according to the information and explanations given to us, neither have we noticed nor have we been informed of any major weakness in the internal control system.

4. Based on the audit procedures applied by us and according to the information and explanations provided by the Management, we are of the opinion that there are no contracts or arrangements which are required to be entered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraph 4(v) (b) of the Order is not applicable.

5. In our opinion and according to the information and explanations given to us the Company has not accepted any deposits from the public. As per the information and explanations given to us, no Order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal on the Company.

6. The Company has an adequate internal audit system commensurate with the size of the Company and the nature of its business.

7. a. According to the records of the Company and the information and explanations given to us, the Company has generally been regular in depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Income Tax and other statutory dues, applicable to it.

b. According to the information and explanation given to us there are no arrears of statutory dues as at the last day of the financial year, outstanding for more than six months from the date they become payable.

c. According to the information and explanations given to us, there are no statutory dues, which are disputed by the Company.

8. The Company does not have an accumulated loss as at March 31, 2014. The Company has not incurred a cash loss during the current financial year or in the immediately preceding financial year.

9. Based on our audit procedures and on the information and explanations given by the Management, we are of the opinion that the Company has not defaulted in repayment of dues to banks.

10. According to the information and explanations given to us and on an overall examination of the financial statements of the Company, we are of the opinion that as at the close of the year, no funds raised on a short term basis has been used for long term investments.

11. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the period nor have we been informed of such case by the Management.

Matters specified in clauses (ii), (viii), (xii), (xiii), (xiv), (xv), (xvi), (xviii), (xix), (xx) of paragraph 4 of the CARO 2003 do not apply to the Company.

For NIPUN SUDHIR & ASSOCIATES Chartered Accountants ICAI Firm Registration Number 0126168W

Sudhir V. Nair Partner (Membership Number 45893)

Mumbai, May 28, 2014


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Fortune Financial Services (India) Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2013, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

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 sub-section (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

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.

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.

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

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, 2013;

b) in the case of the Statement of Profit and Loss, of the loss 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.

Report on other legal and regulatory requirements

1. 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.

2. 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 subsection (3C) of section 211 of the Companies Act, 1956;

e) on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of Section 274(1 )(g) of the Companies Act, 1956.

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

ANNEXURETO INDEPENDENT AUDITORS'' REPORT

Annexure referred to in Paragraph 1 under the heading "Report on Other legal and Regulatory Requirements" of our Report of even date.

On the basis of such checks as we considered appropriate and in our opinion and according to the explanations given to us, we report as under:

1. a. The Company has maintained proper records showing full particulars including quantitative details and situations of fixed assets.

b The Management has not physically verified its fixed assets during the year.

c Based on the information and explanations given by the Management and on the basis of audit procedures performed by us, we are of the opinion that the assets sold by the Company during the year have not affected its going concern.

2. The Company is an investment and merchant banking company and does not hold any inventories. Accordingly, paragraph 4(ii)(a), (b) and (c) of the order is not applicable.

3. a. In our opinion and according to the explanations given to us, the Company has granted unsecured loan to two companies covered in the register maintained under Section 301 of the Act. The maximum amount outstanding in respect of the loan given during the year was Rs. 405.23 lakhs and the year end balance of such loans is Rs. 360.57 lakhs.

b. In our opinion, the rate of interest, and other terms and conditions of the loan granted to the company covered in the Register maintained under Section 301 of the Act are not prima facie prejudicial to the interests of the Company.

c The receipt of principal and interest is regular, wherever there are stipulations with respect to the same.

d. There is no amount overdue in respect of the loans granted by the Company.

e. The Company has taken loan from two companies covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount of the loan taken during the year was Rs. 802.32 lakhs of which one of the year end balance of unpaid loan is Rs. 41.06 lakhs.

f. The repayment of principal and interest is regular wherever there are stipulations with respect to the same.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and for the sale of services. Further on the basis of our examination and according to the information and explanations given to us, neither have we noticed nor have we been informed of any major weakness in the internal control system.

5 Based on the audit procedures applied by us and according to the information and explanations provided by the Management, we are of the opinion that there are no contracts or arrangements which are required to be entered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, paragraph 4(v) (b) of the Order is not applicable.

6. In our opinion and according to the information and explanations given to us the Company has not accepted any deposits from the public. As per the information and explanations given to us, no Order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal on the Company.

7. The Company has an adequate internal audit system commensurate with the size of the Company and the nature of its business.

8. According to the information and explanations given to us, the Company, being an investment & merchant banking company, paragraph 4(viii) of the order is not applicable.

9. .a. According to the records of the Company and the information and explanations given to us, the Company has been regular in depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Income Tax and other statutory dues, applicable to it.

b. According to the information and explanation given to us there are no arrears of statutory dues as at the last day of the financial year, outstanding for more then six months from the date they become payable.

c According to the information and explanations given to us, there are no statutory dues, which are disputed by the Company.

10. The Company does not have any accumulated loss as at 31 March 2013. The Company has incurred a cash loss during the financial year covered by our audit. The Company did not incur any cash loss in the immediately preceding financial year.

11. Based on our audit procedures and on the information and explanations given by the Management, we are of the opinion that the Company has not defaulted in repayment of dues to banks.

12. The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other.

13. The provisions of any special statute applicable to chit fund/ nidhi / mutual benefit fund / societies are not applicable to the Company. Accordingly, paragraph 4(xiii) of the Order is not applicable.

14. Based on our examination of the records and evaluation of the related internal controls, we are of the opinion that proper records have been maintained of the transactions and contracts in respect of its dealing in shares, securities and derivatives and timely entries have been made in those records. We also report that the Company has held the shares, in its own name except those that are intended to be contracted or sold immediately.

15. Based on our audit procedures and as confirmed by the Management, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

16. In our opinion and according to the information and explanations given to us, the Company has not taken any term loans.

17. According to the information and explanations given to us and on an overall examination of the financial statements of the Company, we are of the opinion that as at the close of the year, no funds raised on a short term basis has been used for long term investments.

18. The Company has not made any preferential allotment of shares during the year.

19. The Company has not issued any debentures during the year.

20. The Company has not made any public issue of shares during the year.

21. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the period nor have we been informed of such case by the Management.

For NIPUNSUDHIR & ASSOCIATES

Chartered Accountants

ICAI Firm Registration No. 0126168W

SudhirV. Nair

Partner

(Membership Number 45893)

Mumbai, 29 May 2013


Mar 31, 2012

We have audited the accompanying Balance Sheet of Fortune Financial Services (India) Limited ("the Company") as at 31 March 2012, the Statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 the Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

2) 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 far as appears from our examination of those books;

iii. 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;

iii. In our opinion, the Balance Sheet, Statement of Profit and Loss 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 Act.

iv. On the basis of written representations received from the directors, as at 31 March 2012 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31 March 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act.

v. In our opinion and to the best of our information and according to the explanations given to us, they said accounts read with the notes thereon 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 Balance Sheet, of the state of affairs of the Company as at 31 March 2012;

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

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

In our opinion and according to the explanations given to us, the Company's business / activities during the year are such that clauses (ii), (viii), (x), (xiii), (xvi), (xix) and (xx) of the Companies (Auditor's) Report Order 2003, are not applicable to the Company. In respect of the other clauses, we report as under:

1. a. The Company has maintained proper records showing full particulars including quantitative details and situations of fixed assets.

b. The Management has not physically verified its fixed assets during the year.

c Based on the information and explanations given by the Management and on the basis of audit procedures performed by us, we are of the opinion that the assets and the undertaking sold by the Company during the year have not affected its going concern.

2. a. In our opinion and according to the explanations given to us, the Company has granted unsecured loans to two companies covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount outstanding in respect of the loan given during the year was Rs. 1,855.81 Lacs and the yearend balance of such loan is Rs. 917.63 Lacs

b. In our opinion, the rate of interest and other terms and conditions of loans granted by the Company are not prima facie prejudicial to the interest of the Company.

c The receipt of principal and interest is regular, wherever there are stipulations with respect to the same.

d. There is no amount overdue in respect of the loans granted by the Company.

e. In our opinion and according to the explanations given to us, the Company has taken unsecured loans from two companies covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount outstanding in respect of the loan taken during the year was Rs 738.72 Lacs and the yearend balance of such loan is Nil.

f. In our opinion, the rate of interest and other terms and conditions of loans taken by the Company are not prima facie prejudicial to the interest of the Company.

g. The repayment of principal and interest is regular, wherever there are stipulations with respect to the same.

3. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and for the sale of services. Further on the basis of our examination and according to the information and explanations given to us, neither have we noticed nor have we been informed of any major weaknesses in the internal control system.

4. Based on the audit procedures applied by us and according to the information and explanations provided by the Management, we are of the opinion that are no contracts or arrangements entered in the registers maintained under Section 301 of the Companies Act, 1956. Accordingly, Paragraph 4(v)(b) of the Order is not applicable.

5. In our opinion and according to the information and explanations given to us the Company has not accepted any deposits from the public. As per the information and explanations given to us, no Order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal on the Company.

6. The Company has an adequate internal audit system commensurate with the size of the Company and the nature of its business.

7. a. According to the records of the Company and the information and explanations given to us, the Company has been regular in depositing with the appropriate authorities undisputed statutory dues including provident fund, income tax and other statutory dues, applicable to it.

b. According to the information and explanation given to us there are no arrears of statutory dues as at the last day of the financial year, outstanding for more than six months from the date they become payable

c According to the information and explanations given to us, there are no statutory dues, which are disputed by the company.

8. 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 any bank during the year.

9. Based on our examination of documents and records, and as confirmed by the Management, the Company has not granted loans and advances on the basis of security by way of pledge of shares.

10. Based on our examination of the records and evaluation of the related internal controls, we are of the opinion that proper records have been maintained of the transactions and contracts in respect of its dealing in, securities and timely entries have been made in those records. We also report that the Company has held the securities, in its own name except those that are intended to be contracted or sold immediately.

11. The Company has given guarantee for a loan taken by its subsidiary from a bank, the terms of which are not prima facie prejudicial to the interest of the Company.

12. According to the information and explanations given to us and on an overall examination of the financial statements of the Company, we are of the opinion that as at the close of the year, no funds raised on a short term basis has been used for long term investments.

13. The Company has made a preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

14. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the period nor have we been informed of such case by the Management.

For NIPUN SUDHIR & ASSOCIATES

Chartered Accountants

ICAI Registration Number: 0126168W

Sudhir V. Nair

Partner

(Membership Number 45893)

Mumbai, 30 May 2012


Mar 31, 2011

We have audited the accompanying Balance Sheet of Fortune Financial Services (India) Limited ("the Company") as at 31 March 2011, the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

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 the Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

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

2) 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 far 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 Act.

v. On the basis of written representations received from the directors, as at 31 March 2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31 March 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act.

vi. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the notes thereon 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 Balance Sheet, of the state of affairs of the Company as at 31 March 2011;

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

Annexure referred to in Paragraph (1) of the Auditors' Report to the Members of Fortune Financial Services (India) Limited for the year ended 31 March 2011

In our opinion and according to the explanations given to us, the Company's business / activities during the year are such that clauses (ii), (vi) (viii), (x), (xiii), (xvi), (xix) and (xx) of the Companies (Auditor's) Report Order 2003, are not applicable to the Company. In respect of the other clauses, we report as under:

1. a. The Company has maintained proper records showing full particulars including quantitative details and situations of fixed assets.

b. The Management has physically verified its fixed assets during the year.

c. Based on the information and explanations given by the Management and on the basis of audit procedures performed by us, we are of the opinion that the assets sold by the Company during the year have not affected its going concern.

2. a. In our opinion and according to the explanations given to us, the Company has granted unsecured loans to two companies covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount outstanding in respect of the loan given during the year was Rs.213,504,548 and the year end balance of such loan is Rs. 49,777,937.

b. In our opinion, the rate of interest and other terms and conditions of loans granted by the Company are not prima facie prejudicial to the interest of the Company.

c. The receipt of principal and interest is regular, wherever there are stipulations with respect to the same.

d. There is no amount overdue in respect of the loans granted by the Company

e. In our opinion and according to the explanations given to us, the Company has taken unsecured loans from two companies covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount outstanding in respect of the loan taken during the year was Rs. 102,590,000 and the year end balance of such loan is Nil.

f. In our opinion, the rate of interest and other terms and conditions of loans taken by the Company are not prima facie prejudicial to the interest of the Company.

g. The repayment of principal and interest is regular, wherever there are stipulations with respect to the same.

3. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and for the sale of services. Further on the basis of our examination and according to the information and explanations given to us, neither have we noticed nor have we been informed of any major weaknesses in the internal control system.

4. Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that there are no contracts or agreements which are required to be entered in the register maintained under section 301 of the Companies Act, 1956 have been so entered. Accordingly, paragraph 4(v)(b) of the order is not applicable.

5. In our opinion and according to the information and explanations given to us the Company has not accepted any deposits from the public. As per the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal on the Company.

6. The Company has an adequate internal audit system commensurate with the size of the Company and the nature of its business. Further on the basis of our examination and according to the information and explanations given to us, we have neither come across nor have we been informed of any instance of major weaknesses in the aforesaid internal control systems.

7. a. According to the records of the Company and the information and explanations given to us, the Company has been regular in depositing with the appropriate authorities undisputed statutory dues including provident fund, income tax and other statutory dues, applicable to it.

b. According to the information and explanation given to us there are no arrears of statutory dues as at the last day of the financial year, outstanding for more then six months from the date they become payable

c. According to the information and explanations given to us, there are no statutory dues, which are disputed by the company.

8. 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 any bank during the year.

9. Based on our examination of the records and evaluation of the related internal controls, we are of the opinion that proper records have been maintained of the transactions and contracts in respect of its dealing in, securities and timely entries have been made in those records. We also report that the Company has held the securities, in its own name except those that are intended to be contracted or sold immediately.

10. The Company has given guarantee for a loan taken by its subsidiary from a bank, the terms of which are not prima facie prejudicial to the interest of the Company.

11. According to the information and explanations given to us and on an overall examination of the financial statements of the Company, we are of the opinion that as at the close of the year, no funds raised on a short term basis has been used for long term investments.

12. The Company has made a preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

13. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the period nor have we been informed of such case by the Management.

For NIPUN SUDHIR & ASSOCIATES

Chartered Accountants

ICAI Registration Number: 0126168W

Sudhir V. Nair

Partner

Mumbai, May 26 2011 (Membership Number 45893)












Mar 31, 2010

We have examined the attached Consolidated Balance Sheet of Fortune Financial Services (India) Limited (the Company) and its subsidiaries (the Company and its subsidiaries constitute the "Fortune Group") as at 31 March 2010 and also the Consolidated Profit and Loss Account and the Consolidated Cash Flow Statement of the Fortune Croup for the year ended on that date annexed thereto. These consolidated financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

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 the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

We report that the consolidated financial statements have been prepared by the Company in accordance with the requirements of Accounting Standard (AS) 21, Consolidated Financial Statements notified by Companies (Accounting Standards) Rules, 2006 and on the basis of the separate audited financial statements of the Fortune Group included in the consolidated financial statements.

Further to our comments above, we report that:

On the basis of the information and explanations given to us and on the consideration of the separate audit report on individual audited financial statements of the Fortune Group, we are of the opinion that the consolidated financial statements read together with significant accounting policies in Schedule R and notes appearing thereon, give a true and fair view in conformity with the accounting principles generally accepted in India.

a) in the case of the consolidated Balance Sheet, of the state of affairs of the Fortune Group as at 31 March 2010;

b) in the case of the consolidated Profit and Loss Account, of the consolidated results of operations of the Fortune Group for the year ended on that date; and,

c) in the case of consolidated Cash Flow Statements, of the consolidated cash flows of the Fortune Group for the year ended on that date.

Annexure referred to in Paragraph (1) of the Auditors Report to the Members of Fortune Financial Services (India) Limited for the year ended 31 March 2010.

- 1. a. The Companys records showing particulars including quantitative details and situations of fixed assets are required to be updated.

b. The Management has not physically verified its fixed assets during the year.

c. Based on the information and explanations given by the Management and on the basis of audit procedures performed by us, we are of the opinion that the assets and the undertaking sold by the Company during the year have not affected its going concern.

2. a. In our opinion and according to the explanations given to us, the Company has granted unsecured loans to its subsidiary companies covered in the register maintained under Section 301 of the Act. The maximum amount outstanding in respect of these loans given during the year was Rs. 3,192.36 Lacs (2 parties) and the amount outstanding in respect of these loans at the year end was Rs 1,281.00 Lacs (1 party).

b. In our opinion, the rate of interest and other terms and conditions of the loans given by the Company to the companies listed in the Register maintained under Section 301 of the Act are not prima facie prejudicial to the interests of the Company.

c. All loans (repayable on demand) granted to the companies listed in the register maintained under Section 301 have been repaid, as per stipulations, if any, during the year. Accordingly, there is no amount overdue in respect of the loans granted to the companies/firm listed in the register maintained under Section 301.

d. As the Company has not taken any loan during the year from Companies /firm /parties listed in the register maintained under Section 301 of the Act, clauses 4(iii)(d),4(iii)(e) and 4(iii)(f) are not applicable.

3. In our opinion and according to the information and explanations given to us, there is an adequate internal control procedure commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and for the sale of its services. Further on the basis of our examination and according to the information and explanations given to us, neither have we noticed nor have we been informed of any major weaknesses in the internal control system.

4. a. Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that the transactions that need to be entered in the register maintained under section 301 of the Act have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 does not exceed Rupees Five Lacs.

5. In our opinion and according to the information and explanations given to us the Company has not accepted any deposits from the public. As per the information and explanations given to us, the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal has not passed any order relating to public deposits on the Company.

6. The Company has an internal audit system commensurate with the size of the Company and the nature of its business.

7. In our opinion and according to the explanations given to us, the Company is not required to maintain cost records prescribed by the Central Government under Section 209 (1) (d) of the Act.

8. a. According to the records of the Company and the information and explanations given to us, the Company has been generally regular in depositing with the appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, cess and other statutory dues, if applicable to it.

b. According to the information and explanations given to us, there are no undisputed statutory dues as referred to above as on 31 March 2010 outstanding for a period of more than six months from the date they became payable.

9. The Company does not have any accumulated loss as at 31 March 2010. The Company has not incurred any cash loss during the financial year covered by our audit and in the immediately preceding financial year.

10. Based on our audit procedures and on the information and explanations given by the Management, we are of the opinion that the Company has not defaulted in repayment of dues to banks.

11. Based on our examination of documents and records, and as confirmed by the Management, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

12. Based on our examination of the records and evaluation of the related internal controls, we are of the opinion that proper records have been maintained of the transactions and contracts in respect of its dealing in shares and timely entries have been made in those records. We also report that the Company has held the shares, in its own name except those that are intended to be contracted or sold immediately.

13. The Company has given guarantee for a loan taken by its subsidiary from a bank, the terms of which are not prima facie prejudicial to the interests of the Company.

14. Based on our examinations of the records and information and explanations given to us, the Company has not taken any term loans.

15. According to the information and explanations given to us and on an overall examination of the financial statements of the Company, we are of the opinion that as at the close of the year, no funds raised on a short term basis has been used for long term investments and vice versa.

16. The Company has made a preferential allotment of equity shares and equity warrants to parties covered in the register maintained under section 301 of the Act, the terms of which are not prima facie prejudicial to the interest of the Company.

17. The Company has not issued any debentures during the year.

18. The Company has not made any public issue of any of its securities during the year.

19. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the period nor have we been informed of such case by the Management.

For NIPUN SUDHIR & ASSOCIATES

Chartered Accountants Registration Number: 0126168W

Sudhir V. Nair

Partner Mumbai, 20 May 2010 (Membership Number 45893)

 
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