B&B Realty Ltd

TO THE MEMBERS OF B & B REALTY LIMITED

We have audited the attached Balance Sheet of "B & B REALTY LTD." as at31^st March, 2012 and the Profit and Loss Account for the year ended on thatdate annexed thereto. These financial statements are the responsibility of theCompany’s Management. Our responsibility is to express an opinion on these financialstatements based on our audit.

We have conducted the 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. Anaudit includes examining, on a test basis, evidence supporting the amounts and disclosuresin the financial statements. An audit also includes assessing the Accounting Principlesused and significant estimates made by management, as well as evaluating the overallfinancial statement presentation. We believe that our audit provides a reasonable basisfor our opinion.

As required by the Companies (Auditor’s Report ) Order, 2003, as amended by theCompanies (Auditor’s Report) Amended order- 2004, issued by the Central Government ofIndia in terms of section 227(4A) of the Companies Act, 1956, we enclose in the Annexure astatement on the matters specified in paragraphs 4 and 5 of the said order.

Subject to above and further to our comments in the Annexure referred to above, wereport that:

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

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

d) In our opinion the attached Balance Sheet of the Company as at 31^stMarch, 2012 and the Profit & Loss Account for the year ended on that date complieswith the Accounting Standards referred to in Sub- section (3C) of Section 211 of theCompanies Act, 1956.

e) On the basis of the written representations received from the Directors and taken onrecord by the Board of Directors, we report that none of the Directors is disqualified ason 31^st March, 2012 from being appointed as a Director in terms of clause(g) ofsub-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 said Balance Sheet and Profit and Loss Account read together with thenotes thereon give the information required by the Companies Act, 1956 in the manner sorequired and give a true and fair view in conformity with the Accounting Principlesgenerally accepted in India :

i) in the case of Balance Sheet, of the state of Company’s affairs as at 31^stMarch, 2012

ii) in the case of Profit and Loss Account of the Profit of the Company for theyear ended on that date. and

iii) in the case of cash flow statement, of the Cash flows for the year ended on thatdate.

Annexure referred to in our report of even date to the members of "B & BREALTY LIMITED, BANGALORE" on the accounts for the year ended 31^stMarch, 2012.

1. a) Records of fixed assets have not been produced before us for verification and wehave not verified the existence of the fixed assets.

b) No records in respect of physical verification of fixed assets by management havebeen produced before us and as such we are unable to comment in this respect.

c) During the year the company has not disposed off a substantial part of its fixedassets so as to affect its going concern status

2. a) The inventory has been physically verified during the year by the management. Inour opinion, the frequency of verification is reasonable.

b) In our opinion and according to information and explanation given to us, theprocedure of physical verification of inventories followed by the management is reasonableand adequate in relation to the size of the Company and nature of its business.

c) The Company has maintained proper records of inventories. As explained to us, therewas no material discrepancies noticed on physical verification of inventory as compared tothe book records.

3. The Company has not granted any loans, secured or unsecured, to companies, firms orother parties as covered in the register maintained under Section 301 of the CompaniesAct, 1956. Accordingly the provisions of the clause 4 (iii) (b) to 4 (iii) (d) of theorder are not applicable to the company.

4. The Company has not taken unsecured loans, from companies, firms or other parties ascovered in the register maintained under Section 301 of the Companies Act, 1956.

5. In our opinion and according to the information and explanations given to us, thereare adequate internal control systems commensurate with the size of the company and thenature of its business. Further on the basis of our examination of the books and recordsof the company, and according to information and explanation given to us, we have neithercome across nor have been informed of any continuing failure to correct major weaknessesin the afore said internal control systems..

6. According to the information and explanations given to us the transactions thatneeded to be entered in the register maintained in pursuance of section 301 of theCompanies Act, 1956 have been so entered.

7. In our opinion and according to information and explanation given to us, the companyhas not accepted any deposit from the public and consequently the directives issued by theReserve Bank of India, the provisions of Section 58A and 58AA of the Companies Act, 1956and rules framed there under are not applicable.

8. The Company has not evolved an internal audit system commensurate with its size andthe nature of its business.

9. The Company has not been required by the Central Government to maintain cost recordsunder section 209 (1) (d) of the Companies Act, 1956.

10. a) According to the information and explanations given to us the Company has beenregular in depositing the undisputed statutory dues applicable to it with the appropriateauthorities during the year, except for the under mentioned taxes which have beenoutstanding as at 31^st March 2012 for a period of more than six months from thedate they became payable.

11. The accumulated losses of the company at the end of the financial year under auditwere not more than 50% of its net worth. The Company has not incurred cash losses in thefinancial year under audit and has incurred cash loss in the immediately precedingfinancial year.

12. During the year the company has not defaulted in repayment of dues to bank and thecompany has not issued any debentures.

13. According to the information and explanations given to us the company has notgranted any loans and advances on the basis of security by way of pledge of shares,debentures and other securities.

14. The company is not a Chit Funds / Nidhi / Mutual Benefit Fund/Societies. Thereforethe provisions of clause 4 (xiii) of the said order are not apply to the Company.

15. According to the information and explanation given to us, the Company is notdealing in or trading in shares, securities, debentures, and other investments.Accordingly, clause 4 (xiv) of the order is not applicable.

16. As per information given to us the Company has not given any guarantee for loantaken by others from banks or financial institutions.

17. The Company has not availed any term loan during the year under audit.

18. According to the information and explanations given to us and on an overallexamination of balance Sheet of the company, in our opinion, there are no funds raised ona short term basis, which have been used for long term investment.

19. The Company has made not made any preferential allotment of shares during the yearcovered under audit. Accordingly, clause 4 (xviii) of the order is not applicable.

20. The Company has not issued any debentures during the year.

21. The Company has not raised any money by way of public issue during the year.

22. As per the information and explanations given to us no material fraud on or by theCompany has been noticed or reported during the year.