Auditor Report of Oxford Industries Ltd.

Mar 31, 2014

We have audited the accompanying financial statements of Oxford Industries 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 the significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s 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 Section 211(3C) of the Companies Act, 2013 (the "Act") and in accordance with the accounting principles generally accepted in India. 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 misstatements, whether due to fraud or error.

Auditors'' 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 risk of material misstatements 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 statement 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 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, 2014;

(b) in the case of the Statement of Profit and Loss, 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 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 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 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) We draw attention to clause ''f'' of Note No. 4 to the financial statements. No interest has been provided on Secured Loan in the financial statements for the year. This is contrary to Accounting Standard (AS) 9 on "Revenue Recognition", issued by the Institute of Chartered Accountants of India and the accounting policy being followed by the Company. Had this accounting policy been followed, interest charged to revenue would have been Rs. 589.66 lacs. This short provision of Interest has resulted in loss for the year and Secured Liabilities being understated by Rs. 589.66 lacs.

(e) We further draw attention to clause ''c'' of Note No.4 in the financial statements. The Company has a net loss of Rs. 30.63 lacs (without providing interest of Rs. 589.66 lacs as mentioned at para (d) hereinabove during the year ended 31st March 2014 and, as of that date, the Company''s current liabilities (including overdue term loans, working capital loan and interest accrued and due thereon) exceeded its current assets by Rs 2230 lacs and its total liabilities exceeded its total assets by Rs. 2281 lacs [without providing for interest of Rs. 2171.24 lacs (Rs. 589.66 for financial year 2013-2014, Rs. 514.73 for financial year 2012-2013, Rs. 569.98 lacs for financial year 2011-2012 and Rs. 496.87 lacs for financial year 2010-11)]. These factors, along with other matters as set forth in clause ''c'' of Note No. 4, raise doubt whether the Company will be able to continue as a going concern. However, the accounts for the year have been prepared on the concept that Company will continue as a going concern.

(f) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards referred to in Section 133 of Companies Act, 2013.

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

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT

With reference to the Annexure referred in relation to report on other Legal and regulatory requirements to the Members of M/s. Oxford Industries Limited on the accounts for the year ended March 2014.

We report that:

i. In respect of the Company''s fixed assets:

(a) The Company has generally maintained proper records showing particulars including quantitative details and situation of fixed Assets. The same are in process of being updated.

(b) As explained to us by the management, no physical verification has been conducted of fixed assets under possession of the Lenders. As for other fixed assets, company is following the physically verification in a phased manner, which is reasonable having regard to the size of the Company and the nature of its business. According to the information and explanations given to us, during the physical verification of fixed assets conducted pursuant to such phased program no material discrepancies were noticed during the year.

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

ii. In respect of the Company''s inventories:

During the year the Company was not having any manufacturing facilities. It does not hold any physical inventories. Accordingly the provisions of paragraph 4 (ii) of the Order are not applicable to the company.

iii. The Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties covered in the Register maintained under Section 301 of the Act.

iv. In our opinion and according to the information and explanations given to us, having regard to the explanations that some of the items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory and fixed assets and the sale of goods and services. During the course of our audit, we have not observed any major weakness in such internal control system.

v. In respect of particulars of contracts or arrangements and transactions entered in the register maintained in pursuance of section 301 of the Companies Act, 1956:

(a) To the best of our knowledge and belief and according to the information and explanation given to us, we are of the opinion that particulars of the transaction that needed to be entered into the register maintained under section 301 have been so entered.

(b) According to the information and explanation given to us, such contracts or arrangements aggregating to Rs. 5,00,000/- or more have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. According to the information and explanation given to us, the Company has not accepted any deposits within the meaning of section 58A and 58AA of the Companies Act 1956 and the rules framed there under. Hence clause (vi) of the Order is not applicable.

vii. In our opinion, the Company''s present internal audit system is generally commensurate with its size and nature of its business.

viii. The Central Government of India has not prescribed the maintenance of cost records by the Company under Section 209(1) (d) of the Act for any of its products.

ix. According to the information and explanation given to us and on the basis of our examination of the books of account, in respect of statutory and other dues:

(a) The Company has been generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth tax, Custom Duty, Excise Duty, Cess, Local Tax and other statutory dues wherever applicable which were outstanding as at 31st March 2014 for a period of more than six month from the date they become payable.

(b) The disputed statutory dues that have not been deposited on account of disputed matters pending before appropriate authorities are as under :

x. The Company has accumulated losses of Rs. 3457.66 lacs [without providing for interest of Rs. 2171.24 lacs (Rs. 589.66 for financial year 2013-2014, Rs. 514.73 for financial year 2012-2013, Rs. 569.98 lacs for financial year 2011-2012 and Rs. 496.87 lacs for financial year 2010-11)] as mentioned at clause (v) of para 4 of our Audit Report hereinbefore at the end of the current year [Previous year accumulated loss Rs. 3427.03 lacs (without providing for interest of Rs. 514.73 lacs)], which is more than its entire net worth. During the year the Company has reported cash loss of Rs. 30.86 lacs without providing interest of Rs. 589.66 lacs.

xi. Based on our audit procedures and on the basis of information and explanation given to us by the management and in view of the restructuring proposal sanctioned by the CDR cell and the individual lenders, we understand that the Company has defaulted in repayment of dues to banks and financial institutions and legal action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 (SARFAESI Act, 2002) was initiated by the Lead Bank. The Lead Bank has during the year financial year 2011-12 auctioned the secured assets held in its possession and the Company had made no provision for interest of Rs. 589.66 lacs (previous year Rs. 514.73 lacs) accrued and due for the year on secured loan.

xii. Based on our examination of the records and the information and explanation given to us, the Company has not granted any loan and/or advances on the basis of security by way of pledge of share, debentures and other securities and hence the question of maintenance of adequate records for this purpose does not arise.

xiii. In our opinion and according to the information and explanation given to us, the Company is not a chit fund Company or Nidhi /Mutual benefit fund /society. Therefore the provision of Clause (xiii) of the Order is not applicable to the Company.

xiv. According to the information and explanations given to us, the Company is not dealing or trading in share securities debentures and other investment. Accordingly the provisions of clause (xiv) of the Order are not applicable to the Company

xv. According to the information and explanation given to us, the Company has not given any guarantee for loan taken by others from banks or financial institutions, except counter guarantee given by the Company to Gujarat Industrial Development Corporation in respect of loan sanctioned by financial institutions to Bharuch Eco Acqua Infrastructure Limited. According to information and explanation provided to us, the terms and conditions are not prima facie pre judicial to the interest of the Company.

xvi. According to the information and explanation given to us and on the basis of review of utilisation of funds pertaining to term loans on overall basis the term loans taken by the Company have been applied for the purposes for which they are obtained.

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

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 Companies Act, 1956 during the year.

xix. The Company has not issued any debentures during the year, hence the question of creation of security or charge in respect of debentures issued does not arise.

xx. The Company has not raised any money by public issues during the year.

xxi. To the best of our knowledge and belief and according to the information and explanation given to us, no fraud on or by the Company was noticed or reported during the year.

For R A N K & Associates Chartered Accountants Firm Regn. No. 105589 W

Place: Mumbai Rahul Nahata Dated: 30th May 2014 Partner (Membership No. 116511)

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Mar 31, 2012

1. We have audited the attached Balance Sheet of Oxford Industries Limited as at 31 st March 2012 and also the Profit & Loss Account for the year ended on that date. These financial statements are the responsibility of the management of the Company. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have conducted our audit in accordance with auditing standards generally accepted in India. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statement. 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 presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003, as amended by the Companies (Auditor's Report) (Amendment) Order 2004, issued by the Central Government in terms of section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 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 purpose 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 the books.

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

iv) We draw attention to clause 'P of Note No. 4 to the financial statements. No interest has been provided on Secured Loan in the financial statements for the year. This is contrary to Accounting Standard (AS) 9 on "Revenue Recognition", issued by the Institute of Chartered Accountants of India and the accounting policy being followed by the Company. Had this accounting policy been followed, interest charged to revenue would have been Rs. 569.98 lacs. This short provision of Interest has resulted in loss for the year and Secured Liabilities being understated by Rs. 569.98 lacs.

v) We further draw attention to clause 'c' of Note No.4 in the financial statements. The Company has a net Profit of Rs. 39.80 lacs (without providing interest of Rs. 569.98 lacs as mentioned at para (iv) hereinabove) during the year ended 31st March 2012 and, as of that date, the Company's current liabilities (including overdue term loans, working capital loan and interest accrued and due thereon) exceeded its current assets by Rs. 3275 lacs and its total liabilities exceeded its total assets by Rs. 3293 lacs [without providing for interest of Rs. 1066.85 lacs (Rs. 496.87 lacs for financial year 2010-2011 and Rs. 569.98 for financial year 2011-2012)]. These factors, along with other matters as set forth in clause 'c' of Note No. 4, raise doubt whether the Company will be able to continue as a going concern. However, the accounts for the year have been prepared on the concept that Company will continue as a going concern.

vi) In our opinion the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub section (3C) of section 211 of the Companies Act, 1956.

vii)On the basis of written representations received from the directors as on 31st March 2012 and taken on record by the Board of Directors, we report that none of the directors are disqualified as on 31 st March 2012 from being appointed as a director of the Company in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

viii) In our opinion, and to the best of our information and according to the explanation given to us, the said accounts read together with significant accounting policies and notes forming part of accounts, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally adopted in India:

a. in the case of Balance Sheet, of the state of affairs of the Company as at the 31st March 2012;

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

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

I ANNEXURE TO THE AUDITORS' REPORT

With reference to the Annexure referred to in paragraph 3 of the Auditors Report to the Members of Oxford Industries Limited on the accounts for the year ended on 31st March 2012,

We report that:

i. In respect of fixed assets:

(a) The Company has generally maintained proper records showing particulars including quantitative details and situation of fixed Assets. The same are in process of being updated.

(b) As explained to us by the management, no physical verification has been conducted of fixed assets under possession of the Lenders. As for other fixed assets, company is following the physically verification in a phased manner, which is reasonable having regard to the size of the Company and the nature of its business. According to the information and explanations given to us, during the physical verification of fixed assets conducted pursuant to such phased program no material discrepancies were noticed during the year.

(c) During the year, Indian Bank (Lead Bank) auctioned both the facilities of the company i.e. weaving unit and process house at Ankleshwar, being substantial part of fixed assets of the Company, which, raise doubt whether the Company will be able to continue as a going concern.

ii. In respect of inventories:

(a) As explained to us, the Company was not holding any finished goods, merchandise goods, stores, spare parts or raw materials, other than those in possession of the lenders. No physical verification was carried out for such inventories held by the lenders. As explained to us, there are no inventories stored/ lying with third parties.

(b) In our opinion and according to the information and explanation given to us, the Company has maintained proper records of its inventories.

iii. The Company has neither granted nor taken loans, secured or unsecured to/from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act 1956.

iv. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for sale of the goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control systems.

v. In respect of particulars of contracts or arrangements and transactions entered in the register maintained in pursuance of section 301 of the Companies Act, 1956:

(a) To the best of our knowledge and belief and according to the information and explanation given to us, we are of the opinion that particulars of the transaction that needed to be entered into the register maintained under section 301 have been so entered.

(b) According to the information and explanation given to us, such contracts or arrangements aggregating to Rs. 5,00,000/- or more have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. According to the information and explanation given to us, the Company has not accepted any deposits within the meaning of section 58A and 58AA of the Companies Act 1956 and the rules framed there under. Hence clause (vi) of the Order is not applicable.

vii. In our opinion, the Company's present internal audit system is generally commensurate with its size and nature of its business.

viii. The Central Government of India has not prescribed the maintenance of cost records by the Company under section 209(1) (d) of the Companies Act for any of its products.

ix. According to the information and explanation given to us and on the basis of our examination of the books of account, in respect of statutory and other dues:

(a) The Company has been generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth tax, Custom Duty, Excise Duty, Cess, Local Tax and other statutory dues wherever applicable which were outstanding as at 31st March 2012 for a period of more than six month from the date they become payable.

(b) There are no disputed dues which have not been deposited.

x. The Company has accumulated losses of Rs. 3406.60 lacs [without providing for interest of Rs. 1066.85 lacs (Rs. 496.87 lacs for financial year 2010-2011 and Rs. 569.98 for financial year 2011-2012)] as mentioned at clause (v) of para 4 of our Audit Report hereinbefore at the end of the current year [Previous year accumulated loss Rs. 3446.41 lacs (without providing for interest of Rs. 496.87 lacs)], which is more than its entire net worth. During the year the Company has reported cash loss of Rs. 55.85 lacs without providing interest of Rs. 569.98 as mentioned at clause (iv) of para 4 of our Audit Report hereinbefore (Previous year Cash profit of Rs. 0.11 lacs).

xi. Based on our audit procedures and on the basis of information and explanation given to us by the management and in view of the restructuring proposal sanctioned by the CDR cell and the individual lenders, we understand that the Company has defaulted in repayment of dues to banks and financial institutions and legal action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 (SARFAESI Act, 2002) was initiated by the Lead Bank. The Lead Bank has during the year auctioned the secured assets held in its possession and the Company had made no provision for interest of Rs. 569.98 lacs (previous year Rs. 496.87 lacs) accrued and due for the year on secured loan.

xii. Based on our examination of the records and the information and explanation given to us, the Company has not granted any loan and/or advances on the basis of security by way of pledge of share, debentures and other securities and hence the question of maintenance of adequate records for this purpose does not arise.

xiii. In our opinion and according to the information and explanation given to us, the Company is not a chit fund Company or Nidhi /Mutual benefit fund /society. Therefore the provision of Clause (xiii) of the Order is not applicable to the Company.

xiv. According to the information and explanations given to us, the Company is not dealing or trading in share securities debentures and other investment. Accordingly the provisions of clause (xiv) of the Order are not applicable to the Company

xv. According to the information and explanation given to us, the Company has not given any guarantee for loan taken by others from banks or financial institutions, except counter guarantee given by the Company to Gujarat Industrial Development Corporation in respect of loan sanctioned by financial institutions to Baruch Eco Acqua Infrastructure Limited. According to information and explanation provided to us, the terms and conditions are not prima facie pre judicial to the interest of the Company.

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

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

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 Companies Act, 1956 during the year.

xix. The Company has not issued any debentures during the year, hence the question of creation of security or charge in respect of debentures issued does not arise.

xx. The Company has not raised any money by public issues during the year.

xxi. To the best of our knowledge and belief and according to the information and explanation given to us, no fraud on or by the Company was noticed or reported during the year.

For C. N. Lapsiwala & Co.

Chartered Accountants

Firm Regn. No. 105589 W

Rahul Nahata

Place: Mumbai Partner

Date : 7th July, 2012 Membership No. 116511

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Mar 31, 2011

1. We have audited the attached Balance Sheet of Oxford Industries Limited as at 31 st March 2011 and also the Profit & Loss Account for the year ended on that date. These financial statements are the responsibility of the management of the Company. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have conducted our audit in accordance with auditing standards generally accepted in India. These stan- dards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statement. 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 presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003, as amended by the Companies (Auditor's Report) (Amendment) Order 2004, issued by the Central Government in terms of section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 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 purpose 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 the books.

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

iv) We draw attention to point no. 8 of Schedule 'S' to the financial statements. No interest has been provided on Secured Loan in the financial statements for the year. This is contrary to Accounting Standard (AS) 9 on "Revenue Recognition", issued by the Institute of Chartered Accountants of India and the accounting policy being followed by the Company. Had this accounting policy been followed, interest charged to revenue would have been Rs. 496.87 lacs. This short provision of Interest has resulted in loss for the year and Secured Liabilities being understated by Rs. 496.87 lacs.

v) We further draw attention to point nos. 4 & 5 of Schedule 'S' in the financial statements. The Company has further incurred a net loss of Rs. 98.07 lacs (without providing interest of Rs. 496.87 lacs as mentioned at para (iv) hereinabove) during the year ended 31st March 2011 and, as of that date, the Company's current liabilities (including overdue term loans, working capital loan and interest accrued and due thereon) ex- ceeded its current assets by Rs. 3282.50 lacs and its total liabilities exceeded its total assets by Rs. 2269.84 lacs. These factors, along with other matters as set forth in schedule 'S' at point no. 4 & 5, raise doubt whether the Company will be able to continue as a going concern. However, the accounts for the year have been prepared on the concept that Company will continue as a going concern.

vi) In our opinion the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub section (3C) of section 211 of the Companies Act, 1956.

vii) On the basis of written representations received from the directors as on 31st March 2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March 2011 from being appointed as a director of the Company in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

viii) In our opinion, and to the best of our information and according to the explanation given to us, the said accounts read together with significant accounting policies and notes forming part of accounts, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally adopted in India:

a. in the case of Balance Sheet, of the state of affairs of the Company as at the 31st March 2011;

b. in the case of the Profit & 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.

ANNEXURE TO THE AUDITORS' REPORT

With reference to the Annexure referred to in paragraph 3 of the Auditors Report to the Members of Oxford Industries Limited on the accounts for the year ended on 31st March 2011,

We report that:

i. In respect of fixed assets:

(a) The Company has generally maintained proper records showing particulars including quantitative details and situation of fixed Assets. The same are in process of being updated.

(b) As explained to us by the management, no physical verification has been conducted of fixed assets under possession of the Lenders. As for other fixed assets, company is following the physically verification in a phased manner, which is reasonable having regard to the size of the Company and the nature of its business. According to the information and explanations given to us, during the physical verification of fixed assets conducted pursuant to such phased program no material discrepancies were noticed during the year.

(c) in our opinion and according to information and explanations given to us, during the year, the Company has not disposed of a substantial part of its fixed assets.

ii. In respect of inventories:

(a) As explained to us, physical verification of finished goods, merchandise goods, stores, spare parts and raw materials, other than those in possession of the lenders, have been carried out by the management at reasonable intervals during the year. In our opinion the frequency of verification of inventory is reasonable. As explained to us, there are no inventories stored/ lying with third parties.

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

(c) In our opinion and according to the information and explanation given to us, the Company has maintained proper records of its inventories. In our opinion, discrepancies noticed on physical verification of stock were not material in relation to the operations of the Company and have been properly dealt with in the books of accounts.

iii. (a) The Company has taken unsecured loans from parties listed in the register maintained under section 301 of the Companies Act 1956.

(b) The rate of interest and other terms & conditions of such loans are prima facie not prejudicial to the interests of the Company

(c) There are no stipulations as to the repayment of loans taken by the Company. No interest is paid/ payable on such loans.

(d) In absence of any repayment stipulations, there is no question of overdue amounts.

iv. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for sale of the goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control systems.

v. In respect of particulars of contracts or arrangements and transactions entered in the register maintained in pursuance of section 301 of the Companies Act, 1956:

(a) To the best of our knowledge and belief and according to the information and explanation given to us, we are of the opinion that particulars of the transaction that needed to be entered into the register maintained under section 301 have been so entered.

(b) According to the information and explanation given to us, such contracts or arrangements aggregating to Rs. 5,00,000/- or more have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. According to the information and explanation given to us, the Company has not accepted any deposits within the meaning of section 58A and 58AA of the Companies Act 1956 and the rules framed there under. Hence clause (vi) of the Order is not applicable.

vii. The Company needs to strengthen its internal audit system, so that it is commensurate with the size of the Company and the nature of its business.

viii. The Central Government has prescribed maintenance of cost records under section 209(1 )(d) of the Companies Act 1956 in respect of textile manufacturing activities of the Company. However, we are neither required to nor have we carried out any detailed examination of such accounts and records.

ix. According to the information and explanation given to us and on the basis of our examination of the books of account, in respect of statutory and other dues:

(a) The Company has been generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth tax, Custom Duty, Excise Duty, Cess and other statutory dues wherever applicable other than dues in respect of Notified Area Tax payable to Notified Area Officer, Ankleshwar, amounting to Rs. 15.45 lacs which were outstanding as at 31st March 2011 (Previous Year Rs. 9.52 lacs) for a period of more than six month from the date they become payable.

(b) There are no disputed dues which have not been deposited.

x. The Company has accumulated losses of Rs. 3446.41 lacs (without providing interest of Rs. 496.87 lacs as mentioned at clause (iv) of para 4 of our Audit Report hereinbefore) at the end of the current year (Previous year Rs. 3348.34 lacs), which is more than its entire net worth. During the year the Company has reported cash profit of Rs. 0.11 lac without providing interest of Rs. 496.87 lacs as mentioned at clause (iv) of para 4 of our Audit Report hereinbefore (Previous year Cash loss of Rs. 441.66 lacs).

xi. Based on our audit procedures and on the basis of information and explanation given to us by the management and in view of the restructuring proposal sanctioned by the CDR cell and the individual lenders, we understand that the Company has defaulted in repayment of dues to banks and financial institutions and legal action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 (SARFAESI Act, 2002). As the Lenders were in physical possession of the secured assets throughout the year no provision for interest of Rs. 496.87 lacs accrued and due for the year on secured loan have been made in the books of accounts.

xii. Based on our examination of the records and the information and explanation given to us, the Company has not granted any loan and/or advances on the basis of security by way of pledge of share, debentures and other securities and hence the question of maintenance of adequate records for this purpose does not arise.

xiii. In our opinion and according to the information and explanation given to us, the Company is not a chit fund Company or Nidhi /Mutual benefit fund /society. Therefore the provision of Clause (xiii) of the Order is not applicable to the Company.

xiv. According to the information and explanations given to us, the Company is not dealing or trading in share securities debentures and other investment. Accordingly the provisions of clause (xiv) of the Order are not applicable to the Company

xv. According to the information and explanation given to us, the Company has not given any guarantee for loan taken by others from banks or financial institutions, except counter guarantee given by the Company to Gujarat Industrial Development Corporation in respect of loan sanctioned by financial institutions to Baruch Eco Acqua Infrastructure Limited. According to information and explanation provided to us, the terms and conditions are not prima facie prejudicial to the interest of the Company.

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

xvii. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company we report that the no fund raised on short-term basis have been used for long-term investment. Such investments being financed out of long term borrowings and internal accruals. No long term funds have been used to finance short term assets.

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 Companies Act, 1956 during the year.

xix. The Company has not issued any debentures during the year, hence the question of creation of security or charge in respect of debentures issued does not arise.

xx. The Company has not raised any money by public issues during the year.

xxi. To the best of our knowledge and belief and according to the information and explanation given to us, no fraud on or by the Company was noticed or reported during the year.

For C. N. Lapsiwala & Co. Chartered Accountants Firm Regn. No. 105589 W

Rahul Nahata Partner Membership No. 116511

Place: Mumbai Date : 30th May, 2011

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Mar 31, 2010

1. We have audited the attached Balance Sheet of Oxford Industries Limited as at 31st March 2010 and also the Profit & Loss Account for the year ended on that date. These financial statements are the responsibility of the management of the Company. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have conducted our audit in accordance with auditing standards generally accepted in India. These stan- dards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statement. 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 presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order 2004, issued by the Central Government in terms of section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 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 purpose 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 the books.

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

iv) We draw attention to point nos. 4 & 5 of Schedules in the financial statements. The Company has further incurred a net loss of Rs. 564.36 lacs during the year ended 31st March 2010 and, as of that date, the Companys current liabilities (including overdue term loans, working capital loan and interest accrued and due thereon) exceeded its current assets by Rs. 3277.55 lacs and its total liabilities exceeded its total assets by Rs. 2171.76 lacs. These factors, along with other matters as set forth in schedule S at point no. 4 & 5, raise doubt whether the Company will be able to continue as a going concern. However, the accounts for the year have been prepared on the concept that Company will continue as a going concern.

v) In our opinion the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub section (3C) of section 211 of the Companies Act, 1956.

vi) On the basis of written representations received from the directors as on 31st March 2010 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March 2010 from being appointed as a director of the Company in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

vii) In our opinion, and to the best of our information and according to the explanation given to us, the said accounts read together with significant accounting policies and notes forming part of accounts, give the infor- mation required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally adopted in India:

a. in the case of Balance Sheet, of the state of affairs of the Company as at the 31st March 2010;

b. in the case of the Profit & 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.

ANNEXURE TO THE AUDITORS REPORT

With reference to the Annexure referred to in paragraph 3 of the Auditors Report to the Members of Oxford Industries Limited on the accounts for the year ended on 31st March 2010,

We report that:

i. In respect of fixed assets:

(a) The Company has generally maintained proper records showing particulars including quantitative de- tails and situation of Fixed Assets. The same are in process of being updated.

(b) As explained to us by the management, Company is following the physically verification of the fixed assets in a phased manner, which is reasonable having regard to the size of the Company and the nature of its business. According to the information and explanations given to us, during the physical verifica- tion of fixed assets conducted pursuant to such phased program no material discrepancies were noticed during the year.

(c) in our opinion and according to information and explanations given to us, during the year, the Com- pany has not disposed of a substantial part of its fixed assets.

ii. In respect of inventories:

(a) As explained to us, physical verification of finished goods, merchandise goods, stores, spare parts and raw materials, have been carried out by the management at reasonable intervals during the year. In our opinion the frequency of verification of inventory is reasonable. For inventory stored/lying with third parties, as explained to us, confirmations are being obtained by the Company.

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

(c) In our opinion and according to the information and explanation given to us, the Company has main- tained proper records of its inventories. In our opinion, discrepancies noticed on physical verification of stock were not material in relation to the operations of the Company and have been properly dealt with in the books of accounts.

iii. (a) The Company has taken unsecured loans from parties listed in the register maintained under section 301 of the Companies Act 1956.

(b) The rate of interest and other terms & conditions of such loans are prima facie not prejudicial to the interests of the Company

(c) There are no stipulations as to the repayment of loans taken by the Company. No interest is paid/ payable on such loans.

(d) In absence of any repayment stipulations, there is no question of overdue amounts

iv. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures commensurate with the size of the. Company and the nature of itsbusiness with regard to purchase of inventory and fixed assets and for sale of the goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control systems.

v. In respect of particulars of contracts or arrangements and transactions entered in the register maintained in pursuance of section 301 of the Companies Act, 1956:

(a) To the best of our knowledge and belief and according to the information and explanation given to us, we are of the opinion that particulars of the transaction that needed to be entered into the register maintained under section 301 have been so entered.

(b) According to the information and explanation given to us, such contracts or arrangements aggregating to Rs. 5,00,000/- or more have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. According to the information and explanation given to us, the Company has not accepted any deposits within the meaning of section 58A and 58AA of the Companies Act 1956 and the rules framed there under. Hence clause (vi) of the Order is not applicable.

vii. The Company needs to strengthen its internal audit system, so that it is commensurate with the size of the Company and the nature of its business.

viii. The Central Government has prescribed maintenance of cost records under section 209(1 )(d) of the Compa- nies Act 1956 in respect of textile manufacturing activities of the Company. We have broadly reviewed the accounts and records of the company in this connection and are of the opinion that, prima facie, the pre- scribed accounts and records have been maintained. However, we are neither required to nor have we carried out any detailed examination of such accounts and records.

ix. According to the information and explanation given to us and on the basis of our examination of the books of account, in respect of statutory and other dues:

(a) - The Company has been generally regular in depositing with appropriate authorities undisputed statutory

dues including Provident Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth tax, Custom Duty, Excise Duty, Cess and other statutory dues wherever applicable other than dues in respect of Notified Area Tax payable to Notified Area Officer, Ankleshwar, amounting to Rs. 9.52 lacs which were outstanding as at 31st March 2010 (Previous year Rs. 9.43 !acs) for a period of more than six month from the date they become payable.

(b) There are no disputed dues which have not been deposited.

x. The accumulated losses of the Company as at the end of the previous year were more than its entire net worth and further have increased during the current year. Company has incurred cash loss of Rs. 441.66 lacs during the current year (Previous year Rs. 774.89 lacs).

xi. Based on our audit procedures and on the basis of information and explanation given to us by the manage- ment and in view of the restructuring proposal sanctioned by the CDR cell and the individual lenders, we understand that the Company has defaulted in repayment of dues to banks and financial institutions during the year and legal action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002(SARFAESI Act, 2002) was initiated. However/appropriate provisions for interest accrued and due have been made in the books of accounts.

xii. Based on our examination of the records and the information and explanation given to us, the Company has not granted any loan and/or advances on the basis of security by way of pledge of share, debentures and other securities and hence the question of maintenance of adequate records for this purpose does not arise.

xiii. In our opinion and according to the information and explanation given to us, the Company is not a chit fund Company or Nidhi /Mutual benefit fund /society. Therefore the provision of Clause (xiii) of the Order is not applicable to the Company.

xiv. According to the information and explanations given to us, the Company is not dealing or trading in share applicable to the Company

xv. According to the information and explanation given to us, the Company has not given any guarantee for loan taken by others from banks or financial institutions, except counter guarantee given by the Company to Gujarat Industrial Development Corporation in respect of loan sanctioned by financial institutions to Baruch Eco Acqua Infrastructure Limited. According to information and explanation provided to us, the terms and conditions are not prima facie pre judicial to the interest of the Company.

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

xvii. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company we report that the no fund raised on short-term basis have been used for long-term .invest- ment. Such investments being financed out of long term borrowings and internal accruals. No long term funds have been used to finance short term assets.

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 Companies Act, 1956 during the year.

xix. The Company has not issued any debentures during the year, hence the question of creation of security or charge in respect of debentures issued does not arise.

xx. The Company has not raised any money by public issues during the year.

xxi. To the best of our knowledge and belief and according to the information and explanation given to us, no fraud on or by the Company was noticed or reported during the year.

For C. N. Lapsiwala & Co.

Chartered Accountants

Rahul Nahata

Partner

Place: Mumbai Membership No. 116511

Date :31st May, 2010 Firm Regn. No. 105589 W