AEONIAN INVESTMENTS COMPANY LIMITED ANNUAL REPORT 2011-2012 AUDITORS' REPORT To The Members Aeonian Investments Co. Ltd. We have audited the attached Balance Sheet of AEONIAN INVESTMENTS COMPANY LIMITED, MUMBAI, as at 31st March, 2012, the related Profit & Loss Account for the year ended on that date annexed thereto, and the Cash Flow Statement for the year ended on that date, which we have signed under reference to this report. 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. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes, examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As required by the Companies (Auditor's Report) Order, 2003, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order to the extent applicable. 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 purpose of our audit; b) In our opinion, proper books of accounts, as required by law, have been kept by the Company, so far as it appears from our examination of the Books of the Company; c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the Books of accounts of the Company; d) 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. e) On the basis of written representations received from the Directors and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st 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. f) 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 notes thereon gives the information required by the Companies Act, 1956, in the manner so required and present a true and fair view in conformity with the accounting principles generally accepted in India : i) in the case of Balance Sheet of the state of affairs of the Company as at 31st March, 2012. ii) in the case of Profit & Loss A/c of the Profit for the year ended on that date; and iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date. for RAVI A. SHAH & ASSOCIATES Chartered Accountants Ravi A. Shah, Proprietor Mumbai, 11th May 2012 Membership No. 116667, Firm No.: 125079W Annexure referred to in the Auditor's Report on the Accounts of AEONIAN INVESTMENTS COMPANY LIMITED for the year ended 31st March, 2012. 1. In our opinion and according to the information and explanations given to us, the nature of the Company's business / activities during the year are such that clauses ii, xiii, xvi, xvii, xviii, xix, xx are not applicable to the Company. 2. In respect of its fixed assets : a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets. b) As explained to us, the same have been physically verified by the Management during the year. As per the information and explanations given to us, no discrepancies were noticed on such physical verification as compared with the Books of Accounts. c) The Company has not disposed off substantial part of fixed assets during the year. 3. The Company has not taken any loans from parties listed under the register maintained under Section 301 of the Companies Act 1956. The company has granted a loan to a Company listed under the register maintained under Section 301 of the Companies Act 1956. The year end balance of these loans aggregate to Rs. 6,55,18,981/- and the maximum amount outstanding during the year being Rs. 6,55,54,104/-. In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions of the loan given by the Company are not, prima facie, prejudicial to the interest of the Company. 4. 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 nature of its business with regard to the purchase of inventory and fixed assets and for the sale of goods and services, if any and there have been no major weakness in the internal control procedure. 5. To the best of our knowledge and belief and according to the information and explanations given to us, in respect of transactions entered in the register maintained in pursuance of Section 301 of the Companies Act, 1956: a) all the transactions that needed to be entered into the register have been so entered. b) the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time. 6. In our opinion and according to the information and explanations given to us the Company has not accepted any deposits within the meaning of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed there under. 7. In our opinion, the Company has an internal audit system commensurate with the size of the Company and nature of its business. 8. The requirements of maintaining cost accounts and records as prescribed by the Central Government under section 209(1)(d) of the Companies Act, 1956 are not applicable to the Company. 9. According to the information and explanations given to us in respect of statutory and other dues the Company has been regular in depositing undisputed statutory dues, including income tax, wealth tax, whenever applicable, with the appropriate authorities during the year. The following dues have not been deposited on account of pending disputes: Nature of Dues Amount (Rs.) Nature of dispute and Forum where pending Income Tax 401,640/- Rectification u/s.154 pending with Assessment Year Assessing Officer 2009-2010 10. The Company does not have any accumulated losses as at the end of the financial year. The Company has not incurred cash losses during the current and immediately preceding financial year. 11. According to the information and explanations given to us, the Company has not obtained any borrowings from any bank, financial institutions, or by way of debentures. 12. According to the information and explanations given to us and based on the documents and records produced to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other investments. 13. In respect of dealing in shares, securities, debentures and other investments, in our opinion and according to the information and explanations given to us, proper records have been maintained of the transactions and contracts and timely entries have been maintained therein. The shares, securities, debentures and other securities have been held by the Company, in its own name. 14. In our opinion and according to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks and financial institutions. 15. Based upon the audit procedures 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 RAVI A. SHAH & ASSOCIATES Chartered Accountants Ravi A. Shah, Proprietor Mumbai, 11th May 2012 Membership No. 116667, Firm No.: 125079W