Barflex Polyfilms Ltd Auditor Reports

To,

The Board of Directors

Barflex Polyfilms Limited (formerly Barflex Polyfilms Private Limited)

A-33, Third Floor, FIEE Complex, Okhla Industrial Area Phase-II,

Near C Lal Chowk, New Delhi-110020

Dear Sir,

Reference: Proposed Public Issue of Equity Shares of Barflex Polyfilms Limited (formerly Barflex Polyfilms Private Limited)

1. We have examined the attached Restated Financial Statement of BARFLEX POLYFILMS LIMITED (FORMERLY KNOWN AS BARFLEX POLYFILMS PRIVATE LIMITED) (hereunder referred to "the Company", "Issuer") comprising the Restated Statement of Assets and Liabilities as at March 31, 2024, March 31, 2023 and March 31, 2022, the Restated Statement of Profit & Loss, the Restated Cash Flow Statement for the year ended March 31, 2024, March 31, 2023 and March 31, 2022 the statement of Significant Accounting Policies and other explanatory Information (collectively the Restated Financial Statement) as approved by the Board of Directors in their meeting held on July 9, 2024 for the purpose of inclusion in the Draft Red Herring Prospectus ("DRHP") or Red Herring Prospects ("RHP") or Prospectus (collectively mentioned here as "Offer Document") in connection with its proposed Initial Public Offering (IPO) of equity shares, prepared by the Company in connection with its SME IPO in terms of the requirement of:-

a) Section 26 of Part I of Chapter III of the Companies Act, 2013 as amended (the "Act");

b) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2018 as amended ("ICDR Regulations"); and

c) The Guidance Note on Reports in Company Prospectuses (Revised 2019) issued by the Institute of Chartered

Accountants of India as amended from time to time. ("The Guidance Note")

2. The Companys Board of Directors is responsible for the preparation of the Restated Financial Statements for the purpose of inclusion in the Offer Document to be filed with the relevant Stock Exchange, Securities and Exchange Board of India, and Registrar of Companies, of NCT of Delhi and Haryana in connection with the proposed SME IPO. The Restated Financial Statements have been extracted and prepared by the management of the Company for the year ended March 31, 2024, March 31, 2023 and March 31, 2022 on the basis of annexures to restatement in annexures 2 to 44 to the Restated Financial Statement. The Board of Directors responsibility includes designing, implementing, and maintaining adequate internal control relevant to the preparation and presentation of the Restated Financial Statement. The Board of Directors are also responsible for identifying and ensuring that the Company complies with the Act, ICDR Regulations and the Guidance Note.

3. We have examined such Restated Financial Statement taking into consideration:

a) The terms of reference and terms of our engagement agreed upon with you in accordance with our engagement letter dated February 22, 2024 in connection with the proposed IPO of equity shares of the Company;

b) The Guidance Note also requires that we comply with the ethical requirements of the Code of Ethics issued by the ICAI;

c) Concepts of test checks and materiality to obtain reasonable assurance based on verification of evidence supporting the Restated Financial Statements; and d) The requirements of Section 26 of the Act and the ICDR Regulations. Our work was performed solely to assist you in meeting your responsibilities in relation to your compliance with the Act, the ICDR Regulations and the Guidance Note in connection with the IPO.

4. This Restated Financial Statements have been compiled by the management from the Audited financial statements of the company as at and for the year ended March 31, 2024, March 31, 2023 and March 31, 2022 prepared in accordance with the Accounting Standards as prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014, as amended, and other accounting principles generally accepted in India and have been approved by the Board of Directors of the Company.

5. Auditor Report year ended March 31, 2022, March 31, 2023 and March 31, 2024 audited by us vide report dated September 6, 2022, August 4, 2023 & June 28, 2024 respectively.

6. The adjustments in restated financials were carried out based on the reports issued by us for the years ended March 31, 2024, March 31, 2023 and March 31, 2022.

a) The Restated Financial Statement have been made after incorporating adjustments for the changes in accounting policies and also add line-Material errors, reclassification, regrouping retrospectively in respective financial years to reflect the same accounting treatment as per the changed accounting policy for all reporting periods, if any;

b) The Restated Financial Statement have been made after incorporating adjustments for prior period and other material amounts in the respective financial year to which they relate;

c) Extra-ordinary items that need to be disclosed separately in the accounts has been disclosed wherever required;

d) Do not require any adjustment for modification as there is no modification in the underlying audit reports.

e) Profits and losses have been arrived at after charging all expenses including depreciation and after making such adjustments/restatements and regroupings as in our opinion are appropriate and are to be read in accordance with the Significant Accounting Polices as set out in Annexure 1 to this report;

f) Adjustments in Restated Financial Statement have been made in accordance with the correct accounting policies;

g) There was no change in accounting policies except bonus policy (previously bonus was recorded on cash basis and now it has been booked on accrual basis), which needs to be adjusted in the Restated Financial Statement;

h) There are no revaluation reserves, which need to be disclosed separately in the Restated Financial Statement;

i) The Company has not paid any dividend during FY 2021-22, FY 2022-23 & FY 2023-24.

7. In accordance with the requirements of Part I of Chapter III of Act including rules made there under, ICDR Regulations, Guidance Note and Engagement Letter, we report that-

a) The "Restated Statement of Assets and Liabilities" of the Company as at March 31, 2024, March 31, 2023, and March 31, 2022 is prepared by the Company and approved by the Board of Directors. These Restated Statement of Assets and Liabilities, have been arrived at after making such adjustments and regroupings to the individual financial statements of the Company, as in our opinion were appropriate and more fully described in Significant Accounting Policies as set out in Annexure 1 to this Report.

b) The "Restated Statement of Profit and Loss" of the Company for Financial year ended March 31 2024, March 31, 2023 and March 31, 2022 is prepared by the Company and approved by the Board of Directors. These Restated Statement of Profit and Loss have been arrived at after making such adjustments and regroupings to the individual financial statements of the Company, as in our opinion were appropriate and more fully described in Significant Accounting Policies as set out in Annexures 1 to this Report.

c) The "Restated Statement of Cash Flow" of the Company for Financial period/year ended March 31 2024, March 31, 2023 and March 31, 2022 is prepared by the Company and approved by the Board of Directors.

These Statement of Cash Flow, as restated have been arrived at after making such adjustments and regroupings to the individual financial statements of the Company, as in our opinion were appropriate and more fully described in Significant Accounting Policies as set out in Annexures 1 to this Report.

We have also examined the following other financial information relating to the Company prepared by the Management and as approved by the Board of Directors of the Company and annexed to this report relating to the Company for Financial year ended March 31 2024, March 31, 2023 and March 31, 2022 proposed to be included in the Offer Document for the proposed IPO.

In our opinion and to the best of information and explanation provided to us, the Restated Financial Statements of the Company, read with significant accounting policies as appearing in Annexure 1 are prepared after providing appropriate adjustments and regroupings as considered appropriate.

We, M/s. K R A & Co, Chartered Accountants have been subjected to the peer review process of the Institute of Chartered Accountants of India (ICAI) and our Peer Review Certificate is valid as on the date of signing of this Report.

The preparation and presentation of the Financial Statements referred to above are based on the Audited financial statements of the Company and are in accordance with the provisions of the Act and ICDR Regulations. The Financial Statements and information referred to above is the responsibility of the management of the Company.

The report should not in any way be construed as a re-issuance or re-dating of any of the previous audit reports issued by any other firm of chartered accountants nor should this report be construed as a new opinion on any of the financial statements referred to therein.

We have no responsibility to update our report for events and circumstances occurring after the date of the Report.

In our opinion, the above Restated Financial Statements along with Annexures 2 to 45 of this report read with the respective Significant Accounting Polices as set out in Annexure 1 is prepared after making adjustments and regrouping as considered appropriate and have been prepared in accordance with the Companies Act, ICDR Regulations, Engagement Letter and Guidance Note issued by ICAI.

Our report is intended solely for use of the management and for inclusion in the Offer Document in connection with the Proposed SME IPO of Equity Shares of the Company and our report should not be used, referred to or distributed for any other purpose without our prior consent in writing.