Auditor Report of Vertex Securities Ltd.

Mar 31, 2015

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

Management's Responsibility for the Standalone Financial Statements

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

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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

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

Basis for Qualified Opinion

a) Attention is invited to Note 32 forming part of the Financial Statements, regarding evaluation of long term investment by the management. We have relied upon the confirmation by the management in the absence of independent external evaluation.

b) As stated in Note 27 forming part of the Financial Statements, sundry debtors under the head current assets include old outstanding dues. The sundry debtors outstanding for more than six months amount to Rs. 16,439,009. Further out of the total sundry debtors, for a sum of Rs. 9,695,589, the Company has initiated legal and recovery actions, the proceedings of which are in different stages.

In view of the above, the quantum of realisability of old outstanding sundry debtors/ legally initiated debts is not ascertainable at this stage.

Opinion

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

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor's Report) Order, 2015 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Companies Act, 2013, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

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

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

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

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

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

(f) The company has adequate internal financial controls and in our opinion the same are operating effectively.

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

i. The Company does not have any pending litigations which would impact its financial position/ The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 22 to the financial statements.

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

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

(Annexure referred to in paragraph 1 under the heading of 'Report on Other Legal and Regulatory Requirements' of our report of even date.)

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

(b) As explained to us, some of the fixed assets have been physically verified by the management according to a programme of verification which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies with respect to book records were noticed on such verification.

(ii) The Company had no inventory during the year. Since the Company has no inventory, clauses 3 (ii) of the Order is not applicable.

(iii) In our opinion and according to the information and explanations given to us, the Company has granted unsecured any loans, to a company covered in the register maintained under Section 189 of the Companies Act, 2013.

(a) The company is recovering princiapl and interest on a regular basis.

(b) The balance at 31 March 2015 is Rs. 1,507,635. There is no overdue amount.

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

(v) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposit within the meaning of Section 73 to 76 of the Companies Act, 2013, and the rules framed thereunder.

(vi) In our opinion and according to the information and explanation given to us, pursuant to the Rules made by the Central Government, the maintenance of cost records as prescribed under Section 148 (1) of the Companies Act, 2013, is not applicable to the Company for the year under report.

(vii) (a) According to the records of the Company and the information and explanations given to us, the Company has been regularly depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Employees' State Insurance, Income tax, Sales Tax, Wealth tax, Service tax, Customs Duty, Excise Duty, Value added Tax, Cess and any other statutory dues applicable to it.

There are no undisputed statutory dues as referred to above as at 31st March, 2015 outstanding for a period of more than six months from the date they become payable.

(b) The disputed statutory dues aggregating to Rs. 622,000 that have not been deposited on account of matters pending before the appropriate authority are as under:

Sr. Name Nature Forum Period Amount (`) No. of the of where to which statute dues dispute the is amount pending relates

1 Finance Tax/ The Customs, 2006-07 to 622,000 Act Penalty Excise and 2009-10 Service tax Appellate Tribunal.

(c) The amount required to be transferred to the Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder has been transferred to such fund within time.

(viii) According to the records of the Company, the Company has accumulated losses at the end of the financial year. The Company has incurred a cash loss during the financial year and in the immediately preceding financial year.

(ix) Based on our audit procedures and according to the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to banks or financial institutions.

(x) Based on our examination of the records, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xi) The Company has not taken any term loans during the year.

(xii) To the best of our knowledge, and according to the information and explanations to us, no material fraud on or by the Company has been noticed or reported during the year.

For RAHUL GAUTAM DIVAN & ASSOCIATES Chartered Accountants (Firm's Registration Number: 120294W)



GAUTAM DIVAN Place : Mumbai Partner Date : 12 May, 2015 Membership Number: 006457

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Mar 31, 2014

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

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

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 risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal controls 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 entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Basis for Qualified Opinion

a) Attention is invited to Note 32 forming part of the Financial Statements, regarding evaluation of long term investment by the management. We have relied upon the confirmation by the management in the absence of independent external evaluation.

b) As stated in Notes 27 forming part of the Financial Statements, sundry debtors under the head current assets include old outstanding dues. The sundry debtors outstanding for more than six months amount to Rs.17,670,742/-. Further out of the total sundry debtors, for a sum of Rs.9,695,589/-, the Company has initiated legal and recovery actions, the proceedings of which are in different stages.

In view of the above, the quantum of realisability of old outstanding sundry debtors/ legally initiated debts is not ascertainable at this stage.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, 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:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31 March 2014;

(ii) in the case of the Statement of Profit and Loss, of the loss for the year ended on that date; and

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order"), as amended, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the 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. except for the effects of the matter described in the Basis for Qualified Opinion paragraph, in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956 read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013; and

e. on the basis of written representations received from the directors as on 31 March 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 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

(Annexure referred to in paragraph 1 under the heading of ''Report on Other Legal and Regulatory Requirements'' of our report of even date)

i) (a) The Company has maintained proper records

showing full particulars including quantitative details and situation of fixed assets.

(b) All the assets have been physically verified by the management at the end of the year and, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) There was no substantial disposal of fixed assets during the year.

ii) The Company had no inventory during the year. Since the Company has no inventory, clauses 4 (ii) (a), (b) & (c) of the Order are not applicable.

iii) a) The Company has granted unsecured loans and deposits to companies covered under section 301 of the Companies Act, 1956 during the year. The maximum amount during the year was Rs. 113,298,000 and the year end balance of the loans granted is Rs.977,542. Rs.113,298,000 of the loan in three individual companies have been converted into 8% Non-Cumulative Redeemable Preference Shares during the year.

b) In our opinion the rate of interest and other terms and conditions of said unsecured loans were not, prima facie, prejudicial to the interest of the Company. However no interest was received on the said unsecured loans during the year.

c) As informed to us, the Company was regular in receiving the principal amount as per the terms and conditions of the agreement.

d) As informed to us, there is no overdue amount of loans granted by the Company.

e) The Company has taken unsecured loan from companies covered under section 301 of the Companies Act, 1956. The year end balance of the loans taken is Rs.55,584,061.

f) In our opinion the rate of interest and other terms and conditions of said unsecured loans were not, prima facie, prejudicial to the interest of the Company.

g) As informed to us, the Company was regular in paying the principal amount as per the terms and conditions of the agreement.

(iv) In our opinion and according to the information and explanations 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 fixed assets and sale of services. During the course of our audit, no major weakness has been noticed in the internal control systems in these areas.

(v) (a) According to the information and explanations

given to us, we are of the opinion that the transactions that need to be entered in the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

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

(vii) In our opinion and according to the information and explanation given to us, the Company has an internal audit system commensurate with the size and nature of its business.

(viii) The maintenance of cost records have not been prescribed by the Central Government under section 209(1)(d) of the Companies Act, 1956 for the year under report.

(ix) (a) According to the records of the Company and

information and explanations given to us, the Company has been regularly depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Employee State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs Duty Excise Duty, Cess and any other statutory dues applicable to it. There are no undisputed statutory dues as referred to above as at 31 March 2014 outstanding for a period of more than six months from the date they become payable.

(b) According to the information and explanation given to us and the records of the Company examined by us, disputed amounts of taxes have not been deposited with the authorities as at 31 March 2014 as per details given below:

Nature of Nature of Amount ('') Period to Forum where the Statue dues which dispute is pending amount relates

Finance Act Tax / Penalty 622,000 2006-07 to The Customs, Excise 2009-10 and Service tax Appe llate Tribunal.

(x) According to the records of the Company, the Company has accumulated losses at the end of the financial year. The Company has incurred a cash loss during the financial year and in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to a financial institutions, banks or debenture holders.

(xii) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that since the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities, it is not required to maintain records in respect thereof.

(xiii) The Company is not a chit fund/nidhi/mutual benefit fund/society to which the provisions of special statue relating to chit fund are applicable. Accordingly paragraph 4(xiii) of the Order is not applicable.

(xiv) In respect of shares, securities etc. held as investments by the Company, proper records have been maintained of the transactions and contracts and timely entries have been made by the Company therein and the said investments have been held by the Company in its own name.

(xv) In our opinion and according to the information and explanations given to us, the terms and conditions on which the Company had given guarantees for loans taken by its subsidiary company and others from banks were not prejudicial to the interest of the Company. The outstanding guarantees at the end of the year were '' 30,000,000/- which are shown as a contingent liability.

(xvi) In our opinion, the term loans have been applied for the purpose for which they were raised.

(xvii) According to the information and explanations given to us and an overall examination of the Balance Sheet and Cash Flows of the Company as at 31 March 2014, we report that funds raised on short term basis have not been used for long term investment.

(xviii) During the year, the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, paragraph 4(xviii) of the Order is not applicable.

(xix) The Company has not issued any debentures during the year ended 31 March 2014. Accordingly, paragraph 4(xix) of the Order is not applicable.

(xx) During the year ended 31 March 2014, the Company has not raised money by way of public issue. Accordingly, paragraph 4(xx) of the Order is not applicable.

(xxi) Based on the audit procedures performed and information and explanations given 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 the year ended 31 March 2014.

For RAHUL GAUTAM DIVAN & ASSOCIATES Chartered Accountants (Firm''s Registration Number: 120294W)

RAHUL DIVAN Place : Mumbai Partner Date : 05 May, 2014 Membership Number: 100733

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Mar 31, 2013

Report on the Financial Statements

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

Management''s Responsibility for the Financial Statements

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

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 risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal controls 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

Further to our comments in the Annexure referred to in Paragraph 1 below, we report that:

a) Attention is invited to Notes on Accounts No. 32, regarding evaluation of long term investment by the management. We have relied upon the confirmation by the management in the absence of independent external evaluation.

b) As stated in Notes on Accounts No. 26, sundry debtors under the head current assets include old outstanding dues. The sundry debtors outstanding for more than six months amount to Rs. 18.64 million. Further out of the total sundry debtors, for a sum of Rs. 10.44 million, the Company has initiated legal and recovery actions, the proceedings of which are in different stages.

In view of the above, the quantum of realisability of old outstanding sundry debtors/ legally initiated debts is not ascertainable at this stage.

Subject to our comments stated paragraph (a) and (b) above, 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:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31 March 2013;

(ii) in the case of the Statement of Profit and Loss, of the loss for the year ended on that date; and

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

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

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

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

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

(b) All the assets have been physically verified by the management at the end of the year and, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) There was no substantial disposal of fixed assets during the year.

ii) The Company had no inventory during the year. Since the Company has no inventory clauses 4 (ii) (a), (b) & (c) of the Order are not applicable.

iii) a) The Company has granted unsecured loans and deposits to companies covered under section 301 of the Companies Act, 1956 during the year. The maximum amount during the year was Rs. 54,961,578 and the year end balance of the loans granted is Rs. 54,620,378.

b) In our opinion the rate of interest and other terms and conditions of said unsecured loans were not, prima facie, prejudicial to the interest of the Company.

c) As informed to us, the Company was regular in receiving the principal amount as per the terms and conditions of the agreement.

d) As informed to us, there is no overdue amount of loans granted by the Company.

e) The Company has taken unsecured loan from a company covered under section 301 of the Companies Act, 1956. The year end balance of the loan taken is Rs. 37,927,082.

f) In our opinion the rate of interest and other terms and conditions of said unsecured loans were not, prima facie, prejudicial to the interest of the Company.

g) As informed to us, the Company was regular in paying the principal amount as per the terms and conditions of the agreement.

(iv) In our opinion and according to the information and explanations 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 fixed assets and sale of services. During the course of our audit, no major weakness has been noticed in the internal control systems in these areas.

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

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

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

(vii) In our opinion and according to the information and explanation given to us, the Company has an internal audit system commensurate with the size and nature of its business.

(viii) The maintenance of cost records have not been prescribed by the Central Government under section 209(l)(d) of the Companies Act, 1956 for the year under report.

(ix) According to the records of the Company and information and explanations given to us, the Company has been regularly depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Employee State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs Duty Excise Duty, Cess and any other statutory dues applicable to it. There are no undisputed statutory dues as referred to above as at 31 March 2013 outstanding for a period of more than six months from the date they become payable.

(x)The records of the Company, the Company has accumulated losses at the end of the financial year. The Company has incurred a cash loss during the financial year and in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to a financial institutions, banks or debenture holders.

(xii) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that since the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities, it is not required to maintain records in respect thereof.

(xiii) The Company is not a chit fund/nidhi/mutual benefit fund/society to which the provisions of special statue relating to chit fund are applicable. Accordingly paragraph 4(xiii) of the Order is not applicable.

(xiv) In respect of shares, securities etc. held as investments by the Company, proper records have been maintained of the transactions and contracts and timely entries have been made by the Company therein and the said investments have been held by the Company in its own name.

(xv) In our opinion and according to the information and explanations given to us, the terms and conditions on which the Company had given guarantees for loans taken by its subsidiary company and others from banks were not prejudicial to the interest of the Company. The outstanding guarantees at the end of the year were Rs. 10 million which are shown as a contingent liability.

(xvi) In our opinion, the term loans have been applied for the purpose for which they were raised.

(xvii) According to the information and explanations given to us and an overall examination of the Balance Sheet and Cash Flows of the Company as at 31 March 2013, we report that funds raised on short term basis have not been used for long term investment.

(xviii) During the year, the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, paragraph 4(xviii) of the Order is not applicable.

(xix) The Company has not issued any debentures during the year ended 31 March 2013. Accordingly, paragraph 4(xix) of the Order is not applicable.

(xx) During the year ended 31 March 2013, the Company has not raised money by way of public issue. Accordingly, paragraph 4(xx) of the Order is not applicable.

(xxi) Based on the audit procedures performed and information and explanations given 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 the year ended 31 March 2013. For RAHUL GAUTAM DIVAN & ASSOCIATES

Chartered Accountants

(Firm''s Registration Number: 120294W)

RAHUL DIVAN

Place : Mumbai Partner

Date : 16 May, 2013 Membership Number: 100733

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Mar 31, 2012

1. We have audited the attached Balance Sheet of Vertex Securities Limited as on 31 March 2012, the Profit and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these statements based on our audit.

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

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

4. Further to our comments in the Annexure referred to in Paragraph 3 above, we report that:

i) Attention is invited to Notes on Accounts No.33, regarding evaluation of long term investment by the management. We have relied upon the confirmation by the management in the absence of independent external evaluation.

ii) As stated in Notes on Accounts No. 27, sundry debtors under the head current assets include old outstanding dues. The sundry debtors outstanding for more than six months amounts to X 18.59 million. Further out of the total sundry debtors, for a sum of X 10.37 million, the Company has initiated legal and recovery actions, the proceedings of which are in different stages.

In view of the above, the quantum of realisability of old outstanding sundry debtors/ legally initiated debts is not ascertainable at this stage..

iii) 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;

iv) 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;

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

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

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

viii) Subject to our comments in paragraphs 4(i) and (ii) above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts together with the notes thereon give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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

ANNEXURE TO THE AUDITOR'S REPORT

(Annexure referred to in paragraph 3 of the Auditors' Report of even date to the Members of Vertex Securities Limited on the accounts for the year ended 31 March 2012)

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

(b) All the assets have been physically verified by the management at the end of the year and, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) There was no substantial disposal of fixed assets during the year.

ii) The company had no inventory during the year. Since the company has no inventory, clauses 4 (ii) (a), (b) & (c) of the Order are not applicable.

iii) a) The company has granted interest-free unsecured loans and deposits to companies covered under Section 301 of the Companies Act, 1956 during the year. The maximum amount granted during the year was Rs 46,356,378 and the year end balance of the loans granted is Rs 46,356,378.

b) In our opinion the rate of interest and other terms and conditions of said interest-free unsecured loans were not, prima facie, prejudicial to the interest of the company.

c) The company was regular in receiving the principal amount as per the terms and conditions of the agreement.

d) There is no overdue amount of loans granted by the company.

e) The company has taken interest-free unsecured loan from a company covered under Section 301 of the Companies Act, 1956. The year end balance of the loan taken is Rs 16,395,345. '

f) In our opinion the rate of interest and other terms and conditions of said interest-free unsecured loans were not, prima facie, prejudicial to the interest of the company.

g) The company was regular in paying the principal amount as per the terms and conditions of the agreement.

(iv) In our opinion and according to the information and explanations 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 fixed assets and sale of services. During the course of our audit, no major weakness has been noticed in the internal control systems in these areas.

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

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

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

(vii) In our opinion and according to the information and explanation given to us, the company has an internal audit system commensurate with the size and nature of its business.

(viii) The maintenance of cost records have not been prescribed by the Central Government under section 209(l)(d) of the Companies Act, 1956 for the year under report.

(ix) (a) According to the records of the Company and information and explanations given to us, the Company has been regularly depositing with the appropriate authorities undisputed statutory dues including Provident Fund, Employee State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs Duty Excise Duty, Cess and any other statutory dues applicable to it. There are no undisputed statutory dues as referred to above as at 31 March 2012 outstanding for a period of more than six months from the date they become payable.

(b) According to the information and explanation given to us and the records of the Company examined by us, disputed amounts of taxes have not been deposited with the authorities as at 31 March 2012 as per details given below:

Nature of State Nature of dues Amount Period to which Forum where the disputed is pending amount relates Rs

The Income Tax Act, 1961 Tax/ Interest 1,111,000 AY 2007-08 The Commissioner of (Appeals)

Finance Act Tax/ Penalty 622,000 2006-07 to 2009-10 The Customs, Excise and Service tax Appellate Tribunal.

(x) In our opinion the company has accumulated losses at the end of the financial year. The company has incurred a cash loss during the financial year. No cash loss was incurred in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to a financial institutions, banks or debenture holders.

(xii) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that since the company has not granted any loans and advances on the basis of security by way of pledge of shares/debentures and other securities, it is not required to maintain records in respect thereof.

(xiii) The Company is not a chit fund/nidhi/mutual benefit fund/society to which the provisions of special statue relating to chit fund are applicable. Accordingly paragraph 4(xiii) of the Order is not applicable.

(xiv) In respect of shares, securities etc. held as investments by the company, proper records have been maintained of the transactions and contracts and timely entries have been made by the company therein and the said investments have been held by the company in its own name.

(xv) In our opinion and according to the information and explanations given to us, the terms and conditions on which the company had given guarantees for loans taken by its subsidiary company and others from banks were not prejudicial to the interest of the company. The outstanding guarantees at the end of the year were X 50 million which are shown as an contingent liabilities.

(xvi) In our opinion, the term loans have been applied for the purpose for which they were raised.

(xvii) According to the information and explanations given to us and an overall examination of the Balance Sheet and Cash Flows of the company as at 31 March 2012, we report that funds raised on short term basis have not been used for long term investment.

(xviii) During the year, the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, paragraph 4(xviii) of the Order is not applicable.

(xix) The Company has not issued any debentures during the year ended 31 March 2012. Accordingly, paragraph 4(xix) of the Order is not applicable.

(xx) During the year ended 31 March 2012, the Company has not raised money by way of public issue. Accordingly, paragraph 4(xx) of the Order is not applicable.

(xxi) Based on the audit procedures performed and information and explanations given 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 the year ended 31 March 2012.

For and on behalf of

Rahul Gautam Divan & Associates

Chartered Accountants

(ICAI Reg. No: 120294W)

Rahul Divan

Place: Mumbai Partner

Date: May 15, 2012 Membership No: 100733

---

Mar 31, 2010

1. We have audited the attached BALANCE SHEET of VERTEX SECURITIES LIMITED ("the Company")as at 31st March, 2010, the PROFIT AND LOSS ACCOUNT and also the CASH FLOW STATEMENT of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

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

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

(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 the books;

(c) 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;

(d) 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;

(e) on the basis of the written representations received from the Directors, as at 31 st March 2010 and taken on record

by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2010 from being appointed as Director in terms of clause (g) of sub section (1) of Section 274 of the Companies Act, 1956;

5. Attention is invited to Note no II (20) of Schedule 17, regarding evaluation of long term investment by the management. We have relied upon the confirmation by the management in the absence of independent external evaluation.

6. (a) As stated in Note No:II(6) ofSchedule 17, sundry debtors under

the head current assets include old outstanding dues. The debtors outstanding for more than six months amounts to Rs.224.13 Lakhs. Further out of the total debtors, for a sum ofRs.67.35 Lakhs, the Company has initiated legal and recovery actions, the proceedings of which are in different stages.

In view of the above, the quantum of realisability of old outstanding debtors/legally initiated debts is not ascertainable at this stage.

(b) As stated Note No: 11(5) of Schedule 17, sundry debtors, advances under the head current assets and sundry creditors, security deposits under the head current liabilities, are subject to confirmation, the effect of which, if any, is not ascertainable at this stage.

Subject to the above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the significant Accounting Policies and other notes thereon attached and forming part of the accounts, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2010;

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

(iii) 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 paragraph 3 of our report of even date)

1. a) The Company is maintaining records showing full

particulars including quantitative details and situation of its fixed assets, the maintenance of which offers scope for improvement.

b) We are informed that major part of the fixed assets have been physically verified by the management during the year, which, in our opinion is reasonable having regard to the size of the Company and nature of its assets and that no material discrepancies have been noticed on such verification.

c) The Company has not disposed off substantial part of fixed assets during the year.

2. a) As explained to us, the inventories (stationery, shares in

dematerialized / physical form) have been verified by the management with the supporting evidence at the end of the year, which in our opinion, is reasonable having regard to the size of the Company and nature of its business.

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

c) In our opinion, and according to the information and explanations given to us, the Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification by the management.

3. The Company has granted interest free unsecured demand loan to two companies listed in the register maintained under Section 301 of the Companies Act, 1956. Except for non levy of interest, the terms and conditions of the loan granted are prima facie not prejudicial to the interest of the Company. The maximum amount of loan granted is Rs.3,33,65,278/- and the year end balance is Rs.3,33,65,278/-.

Other than the above loans the Company has not granted any loans secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

The Company has taken interest free unsecured demand loan from a Company listed in the register maintained under Section 301 of the Companies Act, 1956. The terms and conditions of the loan accepted are prima facie not prejudicial to the interest of the Company. The end balance is Rs.1,50,79,161/-.

Other than the above loans the Company has not accepted any loans secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of services. During the course of our audit no major weaknesses has been noticed in the internal controls.

5. a) To the best of our knowledge and belief and according to

the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that need to be entered in the register maintained u/s 301 the Companies Act, 1956, have been so entered.

b) In our opinion and to the best of our knowledge and belief and according to the information and explanations given to us, the transactions made in pursuance to such contracts or arrangements have been made at prices which are reasonable having regard to the market rate prevailing at that time.

6. The Company has not accepted any deposit from the public during the year and hence the directives issued by the Reserve Bank of India and the provisions of sections 58A, 58 AA or any other relevant provisions of the Companies Act, 1956 and rules framed there under, are not applicable to the Company.

7. The Company has an internal audit system. However the scope and coverage of which needs improvement to commensurate with the size of the Company and nature of its business.

8. According to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under section 209(l)(d) of the Companies Act, 1956 in respect of services carried out by the Company.

9. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory liabilities with appropriate authorities. There are no arrears of undisputed statutory dues outstanding as at the last day of the financial year, for a period of more than six months from the date on which they became payable. (b) According to the information and explanation given to us and the records of the Company examined by us, disputed amounts of taxes have not been deposited with the authorities as at 31 st March 2010 as per details give: below.

Nature of Stuate Nature of dues Amount Period to which Forum where the (Rs.) depute is pending

The Income Tax Act, 1961 Tax/Interest 11,11,010 AY 2007-08 The Commissioner of (Appeals)

Finance Act Tax/Penalty 4,97,512 2001-02 to The Customs, Excise and

2005-06 Service tax Appellate Tribunal.

10. The Company has no accumulated losses as at the end of the financial year.

The Company has not incurred cash loss during the current financial year and also in the immediately preceding financial year.

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers.

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

13. The Company is not a Chit Fund/Nidhi/ Mutual Benefit Fund/ Society and hence the provisions thereof are not applicable.

14. Based on our examination of the records and evaluation of related internal controls, the Company has maintained proper records of the transactions and contracts in respect of its dealing in shares and securities and timely entries have been made therein. The shares and securities are held by the Company in its own name.

15. According to the information and explanations given to us, the Company has given counter guarantee amounting to Rs.100 Lakhs during the year for Guarantees taken by its subsidiary from a bank, the terms and conditions of which are not prejudicial to the interest of the Company.

16. According to the information and explanations given to us and the records of the Company examined by us, the term loans availed by the Company have been applied for the purpose for which the loans were obtained.

17. According to the information and explanations given to us and on overall examination of Balance sheet, the Company has not prima facie used any funds raised on short-term basis for long term investment.

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

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

20. The Company has not raised any money by public issue during the year under audit.

21. To the best of our knowledge and belief, based on the audit procedure performed and on the basis of information and explanation provided by the management, no fraud on or by the Company has been noticed or reported during the year.

For and on behalf of Krishnamoorthy & Krishnamoorthy Chartered Accountants (ICAI Reg. No. 001488 S)

C. Krishnamoorthy Place: Kochi Partner Date: 19 May 2010 Membership No: 5957