BIL Continental Ltd

TO THE MEMBERS OF M/s. BIL CONTINENTAL LIMITED

We have audited the attached Balance Sheet of M/s. BIL CONTINENTAL LIMITED as at 31stMarch, 2012 and also the Profit and Loss Account for the year ended on that date annexedthereto. These financial statements are the responsibility of the company's managment ourresponsibility is to express our opinion thereon.

We conducted our audit in accordance with auditing standards generally accepted inIndia. Those Standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of material misstatement.

As required by the Companies (Auditor's Report) Order, 2003 as amended by CARO 2004issued by the Central Government of India in terms of sub-section (4A) of section 227 ofthe Companies Act, 1956, we enclose in the Annexure a Statement on the matters specifiedin paragraphs 4 and 5 of said order.

Further to our comments in the annexure referred to above, we report that:

a) We have obtained all the information and explanation which to the best of ourknowledge 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 theCompany so far as appears from our examination of those books.

c) The Balance Sheet and Profit & Loss Account dealt with by this report are inagreement with the books of account.

d) In oar opinion, the Balance: Sheet and Profit and Loss Account dealt with by thisreport comply with the Accounting Standards referred to in Sub-section (3C) of Section 211of the Companies Act, 1956.

e) On the basis of written representations received from the directors, as on 31stMarch, -2D12and taken on record by the Board of Directors, we report that none of thedirectors is disqualified as on 31st March, 2012 from being appointed as a director interms 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 explanationsgiven to us, the accounts read with notes thereon, give the information required by theCompanies Act, 1956 in the manner so required and give a true and fair view:-

(I) In the case of Balance Sheet of the state of Affairs of the Company as at 31 March2012

(II) In the case of Profit & Loss Account, of the profit of the Company for theyear ended on that date.

ANNEXURE TO THE AUDITORS REPORT M/s. BIL CONTINENTAL LIMITED

1 a) The Company has maintained proper records to show full particulars includingquantitative details and situation of its fixed assets on the basis of availableinformation.

b) The fixed assets have been physically verified during the year by the management andno .material discrepancies were noticed on such physical verification.

c) Based on scrutiny of the records of the company and the information and explanationsreceived by us, we report that there was no sale of fixed assets during the financial yearended 31st March, 2012 substantial or otherwise. Hence the question of Reporting the samedoes not arrive.

2 a) The inventory of the company has been physically verified during the year by themanagement. In our opinion the frequency of verification is reasonable.

b) In our opinion and according to the information and explanations given by themanagement, the procedures followed are reasonable and adequate in relation to size of thecompany and nature of its business.

c) In our opinion the company is maintaining proper records of inventory. As explainedto us, no material discrepancies were noticed on physical verification of inventory ascompared to the book records.

5 In respect of loans, secured or unsecured, granted or taken by the company to/ fromcompanies, firms or other parties covered in the register maintained under Section 301 ofthe companies act' 1956;

a. i) The company has not taken any unsecured loans .

ii) The Company also taken secured loan from nationalized bank of 3419.95 Lacs

b. And other terms & conditions on which loans have been taken are not prima facie,prejudicial to the interest of the company.

c. In respect of loan taken / granted by the company, the principal is repayable ondemand.

There are no overdue amounts in respect of loan taken / granted by the company.

In our opinion and according to the information and explanations given to us, theprocedures of physical verification of stocks followed by the management are reasonableand adequate in relation to the size of the Company and the nature of its business.

5 In respect of loans, secured or unsecured, granted to companies, firms or otherparties covered in the Register maintained under Section 301 of the Companies Act, 1956.

6 The company has not accepted any deposits from the Public.

7 Ih our opinion the company has an adequate Internal Audit System commensurate withthe size and nature of its business.

8 We have been informed by the management, no cost records have been prescribed underSection 209(I) (d) of the Companies Act, 1956 in respect of products manufactured by theCompany.

9 a) According to the records of the company, the company is regular in depositing withappropriate authorities undisputed statutory dues including provident fund, investorEmployee's State Insurance, Income tax, Sales Tax.

b) According to the information and explanations given to us, no undisputed amountpayable in respect of income tax, wealth tax, sales tax, custom duty and excise duty wereoutstanding as at 31 March, 2012

c) According to the records of the company there are no dues of sales tax, income tax,customs tax/wealth tax, excise duty/ cess, which have not been deposited on account of anydispute.

10 The company has not incurred a loss in current year and preceding Financial year, soprovision of accumulated loss is not applicable.

11 According to information and explanations given to us and on the basis of our audit,we are of the opinion that the company has not defaulted in repayment of dues to afinancial institution, bank or debenture holders.

12 According to the records of the company, the company has not granted any loans andadvances on the basis of security by way of pledge of shares, debentures or othersecurities.

13 In our opinion company is neither a chit fund nor a nidhi/ mutual benefit society.Hence in our opinion Para -4(xiii) of the Companies (Auditors') Report Order, 2003 is notapplicable.

14 As per the records of the company and according to information and explanationsgiven to us by the management, company is not dealing or trading in shares, securities,and debentures and other investments.

15 As per the records of the company and according to information and explanationsgiven to us by the management, the company has not given any guarantee for loans taken byothers from bank or financial institutions.

16 The term loans obtained by the company have been applied for the purpose for whichthey were raised.

17 According to information and explanations given to us, and on overall examination ofthe Balance Sheet of the Company, we are of the opinion that no funds raised on short termbasis have been used for long term investment by the company.

18 As per the records of the company and according to information and explanationsgiven to us, the company has not made any preferential allotment of shares to parties andcompanies covered in the register maintained under section 301 of the Act.

19 As per the records of the company, the company has not issued any debentures.

20 The company has not raised any money by public issues during the period covered byour audit report.

21 In our opinion and according to information and explanations given to us, no fraudon or by the company have been noticed or reported during the course of our audit.