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Auditor Report of Innocorp Ltd.

Mar 31, 2014

We have audited the accompanying financial statements of INNOCORP LIMITED ("the Company"), which comprises the Balance Sheet as at March 31,2014, and the Statement of Profit and Loss and Cash flow statement for the year ended, and summary of significant accounting policies and other explanatory information.

Management 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 Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act")which shall continue to apply in respect of section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated September15/2013 issued by the Ministry of Corporate Affairs.. This responsibility includes the design, implementation and maintenance of internal controls 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, 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.

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 Balance Sheet, of the state affairs of the Company as at March 31,2014

(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, 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 sub-section (3c) of section 211 of the Companies Act, 1956read 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.

e. On the basis of the written representations received from the Directors, taken on record by the Board of Directors, none of the directors is disqualiued as at 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 cess is to be paid under section 441A of 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.

Annexure to the Auditors'' Report (referred to in paragraph 1 of our Report of even date to the Members of INNOCORPLIMITED for the year ended March 31,2014)

On the basis of such checks as we considered appropriate and according to the information and explanation given to us during the course of our audit, we report that,

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

(b) The fixed assets of the company have been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.

In our opinion, the frequency of verification is reasonable.

(c) In our opinion, and according to the information and explanation given to us, a substantial part of fixed assets has not been disposed off by the Company during the year.

(ii) (a) As explained to us, inventories have been physically verified by the Management at regular intervals during the year.

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

(c) The company has maintained proper records of inventories. As explained to us there were no material discrepancies noticed on physical verification of inventories as compared to book records.

(iii) (a) According to the information and explanations given to us, the company didn''t grant any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Therefore, requirements of clauses (iii-b),(iii-c), (iii-d),of paragraph 4 of the order are not applicable.

(e) According to the information and explanations given to us, the company had not taken any loans from parties covered in the register maintained under section 301 of the companies Act, 1956. Therefore, requirements of clauses (iii-f), (iii-g) of paragraph 4 of the order are not applicable.

(iv) On the basis of checks carried out during the course of the audit and as per the explanations given to us, we are of the opinion that there are adequate internal control systems commensurate with the size of the company and the nature of its business, with regard to nature of business and payment of expenses. During the course of audit no major weaknesses in the internal controls are noticed.

(v) According to the information and explanations given to us, we are of the opinion that the transactions which are required to be entered in the register maintained under section 301 of the Companies Act. 1956 have been so entered.

(vi) In our opinion and according to the explanations given to us, the company has not accepted any deposits within the meaning of Sections 58A and 58AA of the Companies Act and Companies (Acceptance of Deposits) Rules, 1975.

(vii) As per information and explanations given by the management, the company hasaninternal audit system commensurate with its size and nature of its business.

(viii) We have reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government of India for the maintenance of cost records under Section 209(1)(d) of the Act, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

(ix) (a) According to the records of the company, the company is regular in depositing undisputed statutory dues including income-tax, Provident fund, Employee state insurance, cess and other statutory dues applicable to the company with the appropriate authorities.

(b) According to the information and explanation given to us, there are no dues of income-tax, wealth- tax, sales-tax and cess which have not been deposited on account of any dispute.

(x) The company has accumulated losses at the end of the financial year and its accumulated losses are not less than fifty percent of its net worth and the company has not incurred any cash losses during the current financial year covered by our audit and also in the immediately preceding financial year.

(xi) According to the records of the company and as per the explanations given to us the company has not defaulted in repayment of dues to financial institutions and banks. There are no debentures outstanding in the books of at any time during the year.

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

(xiii) The company is not a chit fund or nidhi / mutual benefit fund / society. Therefore, the provisions of clause 4 (xiii) of the said Order are not applicable to the company.

(xiv) According to the information given to us, the company is not dealing in or trading in shares, securities, debentures and other instruments, accordingly the provisions of clause 4 (xiv) of the order is not applicable.

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

(xvi) On the basis of verification and according to the information and explanations given to us, term loans obtained from bank were applied for the purpose for which the loans were obtained.

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

(xviii) The company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act during the year.

(xix) The company has not issued any debentures during the year. Accordingly, no securities have been created.

(xx) The company has not raised any money by public issue during the year.

(xxi) Based on the audit procedures performed and information and explanations given to us by the management, we report that no fraud on or by the company has been noticed or reported during the course of our audit.

For Ramasamy Koteswara Rao & Co, Chartered Accountants Firm Regn. No. : 010396S

Sd/- (C V Koteswara Rao) Place : Hyderabad Partner Date : 30-05-2014 Membership No. : 028353


Mar 31, 2013

Report on the Financial Statements

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

Management 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 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 judgement, 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.

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 sub-section (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 clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

Annexure to the Auditors'' Report (referred to in paragraph 3 of our Report of even date to the Members of Innocorp Limited for the year ended March 31, 2013

(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 fixed assets are verified in a phased manner over a period of three years. In accordance with this programme, certain fixed assets were verified during the year and no material discrepancies have been noticed on such verification. In our opinion, the periodicity of physical verification is reasonable having regard to the size of the company and nature of its assets.

(c) Fixed Assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

(ii) (a) As explained to us, inventories have been physically verified by the Management at regular intervals during the year.

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

(c) The company has maintained proper records of inventories. As explained to us there were no material discrepancies noticed on physical verification of inventories as compared to book records.

(iii) (a) The company has granted unsecured loans to companies covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year and the year-end balance of such loans aggregating to Rs. 45.04 lakhs and Rs. 380.76 lakhs respectively.

(b) In our opinion, the rate of interest and other terms and conditions on which the loans have been granted to the company listed in the register maintained under Section 301 of the Act are not, prima facie, prejudicial to the interest of the Company.

(c) In the case of the loans granted to the bodies corporate listed in the register maintained Under section 301 of the Act, the borrowers have been regular in the payment of the interest as stipulated.

(d) The company has taken unsecured loan from its directors covered under the register maintained under section 301 of the Companies Act, 1956 during the previous year. The maximum amount outstanding at the year end is Rs.20.731akhs.

(e) The rate of interest and other terms and conditions of such loans taken are, in our opinion, prima facie not prejudicial to the interests of the Company.

(f) In respect of loans taken the company has taken reasonable steps for payments of principal and interest of overdue amounts of more than Rupees on lakh.

(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, with regard to purchase of raw-materials and sale of finished goods. During the course of audit, no major weaknesses in the internal controls are noticed.

(v) (a) According to the information and explanations given to us, we are of the opinion that the company has entered all the transactions required to be entered in the register maintained under section 301 of the Companies Act. 1956.

(b) According to the information and explanations given to us, transactions have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the explanations given to us, the company has not accepted any deposits within the meaning of Sections 58A and 58AA of the Companies Act and Companies (Acceptance of Deposits) Rules, 1975.

(vii) In our opinion, the Company has an internal audit system commensurate with its size and the nature of its business.

(viii) We have broadly reviewed the books of accounts maintained by the company pursuant to the order of the central government for maintenance of the cost records under clause (d) of subsection (1) of section 209 of the companies act 1956, and are of the opinion that primafacie the prescribed accounts and records have been made and maintained

(ix) (a) According to the records of the company, the company is regular in depositing undisputed statutory dues including income-tax, sales-tax, excise-duty, cess and other statutory dues with the appropriate authorities.

(b) According to the information and explanations given to us, there are no income tax, wealth tax, sales tax, customs duty and excise duty, which have not been deposited on account of any dispute.

(a) In the case of Balance Sheet, of the state affairs of the Company as at March 31, 2013

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

(xiv)According to the information given to us, the company is not dealing in or trading in shares, securities, debentures and other instruments, accordingly the provisions of clause 4 (xiv) of the order is not applicable.

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

(xvi)The Term loan raised during the year has been applied for the purpose for which the loan has been obtained.

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

(xviii)The company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

(xix)The company has not issued any debentures during the year. Accordingly no securities have been created.

(xx)The company has not raised any money by public issues during the year.

(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 Ramasamy Koteswara Rao

Chartered Accountants

Firm Reg. No.010396S

sd/-

Date: May 30 C V Ko Partner Rao

M No. 028353


Mar 31, 2010

1 We have audited the attached Balance Sheet of INNOCORP LIMITED (the company) as at 31st March 2010, and also the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date (together referred as financial statements). 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 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 signifcant 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,(CARO), issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956(the Act) and on the basis of such checks of the books and records as we considered necessary and appropriate and according to the information and explanations given to us during the course of the audit, we enclose in the Annexure, a statement on the matters specifed in paragraph 4 & 5 of the said order.

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

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

b. In our opinion, the Company has kept proper books of account as required by law, so far as it appears from examination of these books.

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

d. In our opinion Balance Sheet, Profit and Loss Account 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 the written representations received from directors, and taken on record by the Board of Directors, we report that none of the directors are disqualifed as on March 31, 2010 from being appointed as director under clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

f. In our opinion and to the best of our information and according to the explanations given to us, the said financial statements, 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,

g. In the case of the Balance Sheet, of the state of affairs of the company as at march 31, 2010;

h. In the case of the Profit and Loss Account, of the loss of the company for the year ended on that date; and

i. In the case of the Cash Flow Statement, of the Cash Flows of the company for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT (Referred to in our Report of even date)

1 (a) The Company is required to update the proper records showing full particulars of fixed assets including quantitative details and situation of fixed assets.

(b) The Company has a system of verification of all fixed assets once in a period of two years which in our opinion, is reasonable having regard to the size of the Company and nature of its business.

(c) Company had conducted verification of fixed assets in last year according to explanation given to us.

(d) The Company has disposed off substantial part of fixed assets in the cable division during the year.

2 (a) The Management carried out physical verification of the inventory at reasonable intervals during the year.

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

(c) The Company maintains proper records of inventory. Discrepancies noticed on Physical verification of inventory as compared to the book records were not material and these have been properly dealt with in the books of account

3 (a) The Company has taken unsecured loans from parties who are covered in the register maintained under Section 301 of the Companies Act, 1956, the terms and conditions on which the loans are obtained are not prejudicial.

(b) The Company has granted unsecured loans to parties who are covered in the register maintained under Section 301 of the Companies Act, 1956 the terms and conditions on which the loans are given are not prejudicial.

4 In our opinion, the company has an adequate internal control procedure commensurate with the size of the company and nature of its business for the purchase of inventory and fixed assets and for the sale of goods.

5 (a) According to the information and explanations given to us, based on the disclosure of interest made by the directors of the company, transactions that need to be entered into a register in pursuance of Section 301 of the Act have to be entered.

(b) In our opinion and according to the information and explanations given to us, in respect of the transactions made in pursuance of contracts or arrangement entered in the registers maintained under section 301, the rates at which such services are rendered are reasonable having regard to the prevailing market prices of such services and the prices charged to other parties.

6 the Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of Section 58A and 58AA of the Act and the rules framed there under are applicable.

7 the Company has no internal Audit System during the period covered under this report.

8 the Central Government has not prescribed maintenance of cost records under Section 209(1)(d) of the Act for any of the activities of the Company.

9 According to the information and explanations given to us, the Company is generally regular in depositing undisputed statutory dues including provident fund, Investors education and Protection Fund, employees State Insurance, Income tax, Sales tax, Wealth tax, Custom duty, Cess and any other statutory dues with the appropriate authorities and there were no such outstanding dues as at march 31, 2010 for a period exceeding six months from the date they became payable other then

2010

Income Tax F .Y(2005-06) Rs. 4350297

10 Company is registered for more then five years and the Company has accumulated loss of Rs.73.07 lakh at the end of the financial year and it has incurred cash loss in the financial year while no cash loan found in the preceding year.

11 On the basis of our examination and according to the information and explanations given to us, the company has not defaulted in repayment of the dues to banks/financial institutions with respect to its borrowings.

12 According to the information and explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares.

13 Provision for special statute applicable to Chit Fund, Nidhi, and Mutual Benefit Funds/ Societies are not applicable to the Company.

14 According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

15 According to the information and explanations given to us, the Company has not given Guarantee for loans taken by others from banks or financial institutions the terms and conditions whereof are not prejudicial to the interest of the company.

16 On the basis of examination and according to the information given to us and examinations given to us, the company has not used the funds borrowed on short term basis for long term investment and vice versa.

17 According to the information and explanations given to us, the term loans were utilized for Intended purpose.

18 the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act 1956.

19 According to the information and explanations given to us, the company does not have any debentures and hence the applicability of the clause regarding the creation of security or charge in respect of debentures issued does not arise.

20 According to information and explanations given to us, the company has not raised money by way of public issues during the year; hence the clause regarding the disclosure by the management on the end use of money raised by Public Issue is not applicable.

21 to the best of our knowledge and 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 JBRK & Co

Chartered Accountants

Sd/- Place : Hyderabad p. JITENDRA KUMAR date : 28.08.2010 Partner

Membership No. 22109


Mar 31, 2009

1. We have audited the attached Balance Sheet of INNOCORP LIMITED (the company) as at 31 st March 2009, and also the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date (together referred as financial statements). 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 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,(CARO), issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956(the Act) and on the basis of such checks of the books and records as we considered,necessary and appropriate and according to the information and explanations given to us during the course of the audit, we enclose in the Annexure, a statement on the matters specified in paragraph 4 & 5 of the said order.

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

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

b. In our opinion, the Company has kept proper books of account as required by law, so far as it appears from examination of these books.

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

d. In our opinion Balance Sheet, Profit and Loss Account 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 the written representations received from directors, and taken on record by the Board of Directors, we report that none of the directors are disqualified as on March 31,2009 from being appointed as director under clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

f. In our opinion and to the best of our information and according to the explanations given to us, the said financial statements, 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,

g. In the case of the Balance Sheet, of the state of affairs of the company as at March 31,2009;

h. In the case of the Profit and Loss Account, of the loss of the company for the year ended on that date; and

i. In the case of the Cash Flow Statement, of the Cash Flows of the company for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT (Referred to in our Report of even date)

1. (a) The Company is required to update the proper records showing full particulars of fixed assets including quantitative details and situation of fixed assets.

(b) The Company has a system of verification of all fixed assets once in a period of two years which in our opinion, is reasonable having regard to the size of the Company and nature of its business.

(c) Company had conducted verification of fixed assets in last year according to explanation given to us.

(d) The Company has disposed off substantial part of fixed assets in the cable division during the year.

2. (a) The Management carried out physical verification of the inventory at reasonable intervals during the year.

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

(c) The Company maintains proper records of inventory. Discrepancies noticed on Physical verification of inventory as compared to the book records were not material and these have been properly dealt with in the books of account

3. (a) The Company has taken unsecured loans from parties who are covered in the register maintained under Section 301 of the Companies Act, 1956, the terms and conditions on which the loans are obtained are not prejudicial.

(b). The Company has granted unsecured loans to parties who are covered in the register maintained under Section 301 of the Companies Act, 1956 the terms and conditions on which the loans are given are not prejudicial.

4. In our opinion, the company has an adequate internal control procedure commensurate with the size of the company and nature of its business for the purchase of inventory and fixed assets and for the sale of goods.

5. (a) According to the information and explanations given to us, based on the disclosure of interest made by the directors of the company, transactions that need to be entered into a register in pursuance of Section 301 of the Act have to be entered.

(b) In our opinion and according to the information and explanations given to us, in respect of the transactions made in pursuance of contracts or arrangement entered in the registers maintained under section 301, the rates at which such services are rendered are reasonable having regard to the prevailing market prices of such services and the prices charged to other parties.

6. The Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of Section 58A and 58AA of the Act and the rules framed there under are applicable.

7. The Company has no internal Audit System during the period covered under this report.

8. The Central Government has not prescribed maintenance of cost records under Section 209(1 )(d) of the Act for any of the activities of the Company.

9. According to the information and explanations given to us, the Company is generally regular in depositing undisputed statutory dues including provident fund, Investors Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Custom Duty, Cess and any other statutory dues with the appropriate authorities and there were no such outstanding dues as at March 31, 2009 for a period exceeding six months from the date they became payable other then

- Service Tax Rs. 9,99,189.00

- Income Tax F.Y(2005-06) Rs. 32,26,850.00

- Income tax F.Y(2006-07) Rs. 9,43,578.00

- Fringe Benefit Tax (06-07) Rs. 1,54,648.00

10. Company is registered for more then five years and the Company has accumulated loss of Rs.47.50 lakh at the end of the financial year and it has incurred cash loss in the financial year while no cash loan found in the preceding year.

11. On the basis of our examination and according to the information and explanations given to us, the company has not defaulted in repayment of the dues to banks/financial institutions with respect to its borrowings.

12. According to the information and explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares.

13. Provision for special statute applicable to Chit Fund, Nidhi, and Mutual Benefit Funds/ Societies are not applicable to the Company.

14. According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

15. According to the information and explanations given to us, the Company has not given Guarantee for loans taken by others from banks or financial institutions the terms and conditions whereof are not prejudicial to the interest of the company.

16. On the basis of examination and according to the information given to us and examinations given to us, the company has not used the funds borrowed on short term basis for long term investment and vice versa.

17. According to the information and explanations given to us, the Term Loans were utilized for Intended purpose.

18. The Company has not made any preferential allotment of shares to parties and companies

covered in the register maintained under Section 301 of the Companies Act 1956.

19. According to the information and explanations given to us, the company does not have any debentures and hence the applicability of the clause regarding the creation of security or charge in respect of debentures issued does not arise.

20. According to information and explanations given to us, the company has not raised money by way of public issues during the year; hence the clause regarding the disclosure by the management on the end use of money raised by Public Issue is not applicable.

21. To the best of our knowledge and 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 JBRK&CO

Chartered Accountants

Sd/-

Place : Hyderabad P. JITENDRA KUMAR

Date : 28.08.2009 Partner

Membership No. 22109



 
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