Olympia Capitals Ltd

To The Members Of The Olympia Capitals Limited

1) We have audited the attached Balance Sheet of Olympia Capitals Limitedas at 31^st March, 2005 and the Profit and Loss Account and Cash Flow statementfor the period ended on that date annexed there to. These financial statements are theresponsibility of the Company's management. Our responsibility is to express an opinion onthese financial statements based on our audit.

2) 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. Anaudit includes examining, on a test basis, evidence supporting the amounts and disclosuresin the financial statements. An audit also includes assessing the accounting principleused 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

3) As required by the Companies (Auditor's Report) Order, 2003 issued by the CentralGovernment in terms of Section 227(4A) of the Companies Act, 1956, we annex hereto astatement on the matter specified in paragraph 4 and 5 the said order to the extentapplicable to the Company

4) Further to our comments in the Annexure referred to in Paragraph (1) above.

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, the Company as required by law has kept proper books of account sofar as appears from our examination of the books.

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

d) In our opinion, the Balance Sheet and the Profit & Loss Account and Cash flowstatement dealt with by this report are in compliance with the all mandatory Accountingstandards referred to in Section 211 (3C) of the Companies Act, 1956.

e) In our opinion and to the best of our information and according to the explanationsgiven to us, the said accounts read together with notes thereon, give the informationrequired by the Companies Act, 1956 in the manner so required and give a true and fairview in conformity with 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^stMarch 2005 and

ii) In the case of the Profit and Loss Account of the Loss of the Company to the periodended on that date.

iii) In the case of the Cash Flow Statement, of the cash flows for the period ended onthat date.

f) 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 are disqualified ason 31^st March' 2005 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 AUDITORS' REPORT

(Referred to in paragraph 3 of the Auditors Report of even date to the members ofOlympia Capitals Limited on the accounts for the period ended 31^sl March 2005)

(i) Clause 4(i) of the order is not applicable to the company.

(ii) In respect of inventories:

a) As explained to us, the management at reasonable intervals has physically verifiedthe Stock of Shares, debentures and other Securities.

b) The procedure followed by the Management for physical Verification of stock ofshares, debentures and Securities are in our opinion reasonable and adequate in relationto the size of the Company and the nature of its business.

c) As explained to us, no discrepancies were noticed on such verification between thebook records and physical stock of shares, debentures and Securities.

(iii) a) The Company has not granted nor taken any loans, secured or unsecured to/fromDirectors firms and other parties listed in the Register maintained under Section 301 ofthe Companies Act, 1956. Accordingly, sub-clause (b), (c), and (d) are not applicable.

(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 Companyand nature of its business for the purchase of plant & machinery, equipment and otherassets and for the sale of goods

(v) In our opinion and according to the information and explanations given to us the,there were no transactions that need to be entered in the register maintained in pursuanceof section 301 of the Act.

(vi) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposit within the meaning of the provision of Section 58Aand 58AA of the Companies Act, 1956 and the Non Banking Financial Companies (Reserve BankDirection's 1977.

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

(viii) As informed to us, the maintenance of cost records has been not prescribed bythe Central Government under clause (d) of sub-section (1) of section 209 of the CompaniesAct. 1956. in respect of the activities carried on by the Company.

(ix) In respect of statutory dues:

a) We are informed that during the year under review, the company has regularly,deposited all the undisputed statutory dues including Provident Fund, Investor Education& Protection Fund , income tax, wealth tax, sales tax, custom duty , excise duty, cessand any other dues where ever applicable. There is no undisputed amounts not deposited dueover six months from the date they became payable as on last day of the financial year.

b) The Company has disputed liability of Income Tax aggregating to Rs. 29.52 lacs inrespect of Assessment year 1995-96 for which the Company has preferred an appeal with theAppellate Tribunal and Commissioner of Income Tax (Appeals).

(x) The accumulated loss of the company at the end of financial year are more thanfifty percent of its net worth and has incurred cash losses in the current financial yearand in the immediately preceding financial year.

(xi) The company has not taken any loan from any financial institution or bank ordebenture holders, the question of defaulted in repayment of dues to a financialinstitution or bank or debenture holders does not arise.

(xii) In our opinion and on the basis of information and explanations given to us, thecompany has not granted loans and advances on the basis of security by way of pledge ofshares, debentures or other Securities.

(xiii) In our opinion and according to the information and explanation given to us, thenature of the activities of the company does not attract any special statute applicable tochit fund and nidhi/ mutual benefit fund/societies;

(xiv) In our opinion the company has maintained proper records of the transactions andcontracts of the investments dealt in by the company and timely entries have been madetherein. The shares, securities, debentures and other securities have been held by thecompany, in its own name except to the extent of the exemption, if any, granted undersection 49 of the Act;

(xv) According to the information and explanations given to us and the records examinedby us, the company has not given any guarantee for loans taken by others from bank orfinancial institutions, the terms and conditions whereof are prejudicial to the interestof the company.

(xvi) The company has not applied for term loans during the year.

(xvii) The company has not raised funds on short-term basis.

(xviii) The Company has not made any preferential allotment of shares to parties orcompanies covered in the Register maintained under section 301 of the Act.

(xix) Since the company has not issued any debentures, the question of creation ofsecurity does not arise.

(xx) The company has not raised money through a public issue during the year.

(xxi) No fraud on or by the company has been noticed or reported during the year.