Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters staled in Section 134(5) of the Companies Act, 2013 (l'the Act") with respect to the preparation and presentation of these financial statements that give a true and lair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and delecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant ro the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement whether due io fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act. the accounting and auditing standards and matters which arc required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements arc free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, hut not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of1 the accounting policies used and the reasonableness of the accounting estimates made hy the Company's Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us. the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March. 2015 and its Loss and its Cash Flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors Report) Order, 2015 ("the Order) issued by the Centra! Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexurc a statement on the matters Specified in the paragraph 3 and 4 of the Order, to the extent applicable.

2. As required by Section 143 (3) of the Act, we report that;

(a) W'e have sought and obtained all the information and explanations which to the best of our knowledge 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 the Company so far as it appears from our examination of those books;

(c) The Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules. 2014:

(e) On the basis of the written representations received from the directors as on 31 March 2015 taken on record by the Board of Directors, none of the directors are disqualified as on 31 March 2015 from being appointed as a director in terms of Section 164 (2) of the Act; and S

(f) With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company docs not have any pending litigations which would impact its financial position, '

it. Thc Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses,

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company,

Annexure to the Independent Auditofs Report

Referred to in paragraph under the heading "Report on Other Legal and Regulatory Requirements" of our Independent Auditors' Report of even date to the members of Venlon Enterprises Limited on the financial statements for the year ended 131 March 2015.

We report that:

1. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) The fixed assets are physically verified by the management according to a phased program designed to cover all the items over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of' its assets. No material discrepancies were noticed on such verification.

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

(b) In our opinion, the procedures of physical verification of inventory' followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business

(c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records which lias been properly dealt with in the books of account were not material.

3. (a) The Company has not granted unsecured loans to Companies covered in the register maintained under Section 189 of the Companies Act. 2013 ('the Act').

(b) Accordingly, paragraph 3(iii)(b) and 3(iii)(c) of the Order are not applicable to the Company.

4. In our opinion and according to the information and exp I actions given to us, them are adequate internal control systems which commensurate with the size of the company and the nature of its business for the purchase of inventory and fixed assets and for the sale of' goods. Further, on the basis of our examination of the books and records of the company and according to the information and explanations given to us. we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control procedures.

5. The Company has not accepted any deposits from the public within the meaning of Section 73 to 76 or any other Relevant Provisions of the Companies Act, 2013 and the rules framed there under. No order hasdbeen passed by National Company Lawr Tribunal or Reserve Hank of India or any Court or any other Tribunal.

6. We have broadly reviewed the books of account maintained by the Company in respect of products where, pursuance to the Rules made by the Central Government, the maintenance of cost records has been prescribed under section 148(1) of the Companies Act, 2013 and are of the opinion that prim a facie, the prescribed accounts and records have been made and maintained in respect of the products manufactured by the Company, We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

7. (a) According to the information and explanations given to us and the records of the Company examined by us, no undisputed statutory dues including provident fund, employees' state insurance, sales lax. wealth lax, service tax, customs duty, value added tax, excise duty, cess and other material statutory dues as applicable with the appropriate authorities, except income tax ( I DS) where there has been a slight delay. The Company has since remitted the income tax (TDS).

(b) According to the information and explanations given to us, there arc no dues of Provident fund. Income tax, Sales tax. Wealth tax, Service tax, Custom duty. Value added tax, Pxcise duty and Cess which have not been deposited on account of any dispute,

(c) According to the information and explanations given to us, no amounts were required to be transferred to the investor education and protection fund in accordance with relevant provisions of the Companies Act, 1956 (1 of 1956) and rules there under. Accordingly, paragraph 7(c) of the Order is not applicable to the Company in respect of amounts being transferred to such fund within time.

8. In our opinion, the accumulated losses of the Company are more than fifty percent of its net worth. The Company has incurred cash losses during the financial year covered by our audit. However the company had not incurred cash loss during the immediately preceding financial year.

9. According to the records of the Company examined by us and die information and explanations given to us. the Company has not defaulted in repayment of dues to any financial institution or bank as at the balance sheet date. The Company has not issued any debentures.

10. in our opinion and according to the information and explanations given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions during the vear.

11, In our opinion, and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained

12. During the eourse of our examination of the books and records of the company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, wre have neither come across any instance of material fraud on or by the company, noticed or reported during the year, nor we have been informed of any such case by the management.

FotjRAU & NATHAN Chartered Accountants Firm Registration # 003178S

N.VAfWANAmAygX Partner Membership# 022573

Place : MYSURU Date : 30 May, 2015