I Power Solutions India Ltd

TO MEMBERS

I have audited the attached Balance sheet of i Power Solutions India Limited as at 31stMarch 2011 also the Profit and Loss account of the Company for the Year ended on that dateboth annexed thereto. These Financial statements are the responsibility of the management.My responsibility is to express an opinion on these financial statements based on myaudit.

I conduct the audit in accordance with the Auditing Standards generally accepted inIndia. Those Standards require that I 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 and supporting the amounts anddisclosures in the financial statements. An audit also includes assessing the accountingprinciples used and significant estimates made by management as III as evaluating theoverall financial statements presentation. I believe that my audit provides a reasonablebasis for my opinion..

1. As required by the Manufacturing and other companies Auditor's report order 1988,issued by the company law board in terms of section 227 (4A) of the companies act, 1956,1enclose in the annexure a statement on the matters specified in paragraph 4 & 5 of thesaid order.

2. Further to comments in the annexure referred to in paragraph 1 above, I report that:

(i) I have obtained all the information and explanations which to the best of myknowledge and belief Ire necessary for the purpose of my audit.

(ii) In My opinion proper books of accounts as required by law have been kept by thecompany so far as it appears from my examination of such books.

(iii) The Balance sheet and Profit and loss account and Cash Flow Statement referred into this report are in agreement with the books of account.

(iv) In My opinion, the Balance sheet, Profit and loss account and Cash flow statementdealt with by this report comply with the applicable Accounting Standards referred to inSection 211(3c) of the Companies Act, 1956

(v) On the basis of information and explanations given to me, none of the directors ofthe company is prima facie, as at 31st March 2011 disqualified from being appointed as aDirector of the company under Section 274(1) (g) of the Companies Act, 1956

(vi) in My opinion and to the best of My information and according the explanationsgiven to me the said Balance sheet and Profit and Loss account read together with thenotes therein, give the information required by the companies act, 1956, in the manner sorequired and give a true and fair view:

(a) In so far it relates to the Balance Sheet of the state of affairs of the company asat 31st March 2011

and

(b) In so far as it relates to the Profit and Loss account, of the profit of thecompany for the Year ended on that date

(C) In the case of the Cash Flow statement, of the cash flows for the year ended onthat date.

(Referred to in Paragraph 3 of my Report of Even Date)

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

i (b) As explained to me, physical verification of a major portion of fixed assets asat March 2011 was conducted by the Management during the year. In my opinion, thefrequency of verification is reasonable. Having regard to the size of the operations ofthe company and on the basis of explanations received, in my opinion, the net differencefound on physical verification were not significant.

ii. The Company has no inventories and therefore, the provisions of clause 4 (ii) ofthe Companies (Auditor's Report) order, 2003 are not applicable to the company

iii. The Company has taken unsecured loans from other parties covered in the registermaintained under section 301 of the Companies Act, 1956 and is not prima-facie prejudicialto the interest of the company.

iv. In my Opinion and according to the information and explanations given to me, thereare adequate internal control procedures commensurate with the size of the company and thenature of its business with regard to purchases of fixed assets and with regard to thesale of goods and services. During the course of my audit, I have not observed any majorweakness in the internal controls.

v. (a) To the best of my knowledge and belief and according to the information andexplanations given

to me, I am of the opinion that the particulars of contracts or arrangements referredto in section 301 of the Companies Act, 1956 have been entered on the Register to bemaintained under that

section.

(b) Transactions made in pursuance of such contracts or arrangements have been made atprices which are reasonable having regard to the prevailing market prices at that relevanttime.

vi In my opinion and according to the information and explanations given to me, thecompany has not accepted deposits from the public during the year.

vii. In my opinion, the company has an internal audit system commensurate with the sizeand nature of its business.

viii. According to the information and explanations given to me, the Central Governmenthas not prescribed maintenance of cost records under clause (d) of sub-section (1) ofSection 209 of the Companies Act, 1956 for any products of the company.

ix. According to the information and explanations given to me, no undisputed amountpayable in respect of Income tax, Sales tax, Custom Duty, Excise Duty and cess were inarrears, as at March 2011 for a period of more than six months from the date they becamepayable.

x. In my opinion and according to the information and explanations given to me, thecompany has not borrowed any loan from Financial Institution or Bank, hence default inrepayment of dues to financial institution or bank does not arise.

xi. In my opinion and according to the explanations and information given to me, thecompany has not granted any loans and advances on the basis of security by way of pledgeof shares, debentures and other securities.

xii. In my opinion and according to the information and explanations given to me, thecompany is not dealing in or trading in shares, securities, debentures and otherinvestments. Accordingly, the provisions of clause 4 (xiv) of the CARO, 2003 are notapplicable to the company.

xiii. In my opinion and according to the information and explanations given to me, thecompany has not given any guarantee, for loans taken by others from banks or financialinstitution; hence prima-facie prejudicial to the interest of the company does not arise.

xiv. In my opinion and according to the information and explanations given to me, thecompany has not taken any term loans and the purpose, hence the application of such loanfor which they were raised does not arise.

xv. In my opinion and according to the information and explanations given to me, and onan overall examination of the balance sheet of the company, I report that no funds raisedon short-term basis have been used for long-term investment.

xvi. To the best of my knowledge and belief and according to the information andexplanations given to me, no fraud on by the company has been noticed or reported duringthe course of my audit.

Clauses 4(xiii) and 4(xix) of the Companies (Auditor's Report) order 2003 are notapplicable to the Company.

Sd./-

W.S.MADHAVANN

Chartered Accountant

Membership No: 201067