Auditor Report of Accentia Technologies Ltd.

Mar 31, 2014

1. Report on the Financial Statements

We have audited the accompanying financial statements of ACCENTIA TECHNOLOGIES LIMITED(''the Company''), which comprise the Balance Sheet as at March 31, 2014, Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

2. Management''s Responsibility for the Financial Statements

Management of the Company is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatements, whether due to fraud or error.

3. Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those standards require that we comply with ethical requirement and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amount and 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 control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and reasonableness of the accounting estimates made by the management, 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.

4. Opinion

In our opinion and to the best of our information and according to the explanations given to us, and the 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:

i) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

ii) In the case of the Statement of Profit and Loss of the profit for the year ended on that date; and

iii) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

5. Report on Other Legal and Regulatory Requirements

(i) As required by the Companies (Auditor''s Report) order, 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement of the matters specified in paragraph 4 and 5 of the said order.

(ii) Further to our comments in the Annexure referred to in Paragraph 5(i) above, as required by section 227(3) of the Act, we report that;

a. we have obtained all the information and explanation which to the best of our knowledge and belief were necessary for the purpose of our audit;

b. in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c. the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d. in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt herewith comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956;

e. on the basis of the written representations received from the Directors and taken on records by the Board of Directors, none of the Director is disqualified, as at the balance sheet date, from being appointed as a Director in terms of section 274 (1) (g) of the Companies Act, 1956;

f. Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

Annexure referred to in Paragraph 1 of our report dated 25/11/2014, to the members of ACCENTIA TECHNOLOGIES LTD

I. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of Fixed Assets on the basis of information available.

(b) As explained to us, all the fixed assets have been physically verified by the management during the year. There is a regular programme of verification 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 physical verification.

(c) In our opinion and according to information and explanation given to us no substantial part of fixed asset has been disposed off by the company during the year and the going concern status of the company is not affected.

II. This clause is not applicable to the Company.

III. (a) The Company has granted unsecured loans to four subsidiaries covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year and year end balance of such loans were Rs. 2,158.75 lakhs.

(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions for the loans mentioned in para (iii) (a) above, are prima facie not prejudicial to the interest of the Company.

(c) Since the loans mentioned in para (iii) (a) above are without any fixed repayment schedule, the question of examining the regularity of repayment of the Principal amount and interest thereon, does not arise.

(d) For the same reasons given in para (iii) (c) above, the question of examining the over due amount and commenting on the reasonableness of the steps taken by the Company for the recovery of such loans does not arise.

(e) The Company has not taken loans from party covered in the register maintained under Section 301 of the Companies Act, 1956, hence para (f) to (g) of the clause 4 (iii) of the order is not applicable to the company.

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 Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. Further, on the basis of our examination of the books and records of the company, and according to the information and explanation 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.

V. (a) In respect of transactions covered under section 301 of the Companies Act, 1956. In our opinion and according to the information given to us, there are no such transactions made in pursuance of contracts or arrangements that needed to be entered into in the register maintained undersection 301 of the Companies Act, 1956, hence para (b) of the clause 4 (v) of the order is not applicable to the company.

VI. The Company has not accepted any deposits during the year and consequently the provision of section 58A and 58AA of the Companies Act, 1956 and the rules framed there under are not applicable.

VII. In our opinion, the Company has an internal audit system commensurate with its size and nature of business.

VIII. We have been informed that the maintenance of cost records has not been prescribed by the central government under section 209(1) (d) of the Companies Act, 1956.

IX (a) According to the information and explanation given to us the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including income tax, sales tax, wealth tax,customs duty, excise duty, service tax, cess and other material statutory dues applicable.

(b) According to the information and explanation given to us no undisputed statutory dues including income tax, sales tax, wealth tax, customs duty, excise duty, service tax, cess and other material statutory dues applicable were in arrears as at 31.03.2014 for a period of more than six months from the date they became payable.

(c) According to the information and explanation given to us, there are no dues of income tax, sales tax, customs duty, wealth tax, service tax, excise duty and cess which has been deposited on account of any dispute except the below.

X. The Company does not have any accumulated losses at the end of the year. The company has not incurred any cash losses for the year under review and immediately preceding such current year.

XI. According to the records of the company examined by us and the information and explanation given to us, the Company has defaulted in repayment of dues to Financial Institution and Banks.

XII. We are informed that the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and the securities. Accordingly the provisions of the clause 4 (xii) of the order are not applicable to the company.

XIII. The Company is not a chit fund or a nidhi/mutual benefit fund/society. Accordingly the provisions of the clause4 (xiii) of the order are not applicable to the company.

XIV. According to the information and explanation given to us the company is not dealing in or trading in shares, securities, debenture and other investments.

XV. According to the information and explanation given to us the company has not given any guarantee for loans taken by others from banks or financial institutions.

XVI. According to the information and explanation given and based on the documents and records produced, on an overall basis, the term loans have been applied for the purpose for which they were obtained.

XVII. According to the information and explanations provided to us and an overall examination of the balance sheet and the cash flow statement of the Company, in our opinion no funds raised on short term have been used for long term investment.

XVIII. According to the information and explanations provided to us, during the year, the Company has not made preferential allotment of equity shares during the current year.

XIX. According to the information and explanations provided to us, during the year the Company has not issued any debentures till date.

XX. According to the information and explanations provided to us, during the year the Company has not raised any money by way of public issues. Accordingly the provisions of the clause 4 (xx) of the order are not applicable to the company.

XXI. Based upon the Audit procedures performed and information and explanation given to us, we report that no fraud on or by the company has been noticed or reported during the course of our audit.

For DMKH & Co. Chartered Accountants Firm Reg. No. - 116886W

CA. Durgesh Kabra Place : Navi Mumbai Partner Date : November 25, 2014 Membership No. : 044075

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Mar 31, 2013

1. Report on the Financial Statements

We have audited the accompanying financial statements of ACCENTIA TECHNOLOGIES LIMITED (''the Company''), which comprise the Balance Sheet as at March 31, 2013, Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

2. Management''s Responsibility for the Financial Statements

Management of the Company is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatements, whether due to fraud or error.

3. Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those standards require that we comply with ethical requirement and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amount and 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 control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and reasonableness of the accounting estimates made by the management, 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.

4. Opinion

In our opinion and to the best of our information and according to the explanations given to us, and the 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:

i) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2013;

ii) In the case of the Statement of Profit and Loss of the profit for the year ended on that date; and

iii) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

5. Report on Other Legal and Regulatory Requirements

(i) As required by the Companies (Auditor''s Report) order, 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement of the matters specified in paragraph 4 and 5 of the said order.

(ii) Further to our comments in the Annexure referred to in Paragraph 5(i) above, as required by section 227(3) of the Act, we report that;

a. we have obtained all the information and explanation which to the best of our knowledge and belief were necessary for the purpose of our audit;

b. in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c. the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d. in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt herewith comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956;

e. on the basis of the written representations received from the Directors and taken on records by the

Board of Directors, none of the Director is disqualified, as at the balance sheet date, from being appointed as a Director in terms of section 274 (1) (g) of the Companies Act, 1956;

f. Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

I. (a) The Company has maintained proper records

showing full particulars, including quantitative details and situation of Fixed Assets on the basis of information available.

(b) As explained to us, all the fixed assets have been physically verified by the management during the year. There is a regular programme of verification 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 physical verification.

(c) In our opinion and according to information and explanation given to us no substantial part of fixed asset has been disposed off by the company during the year and the going concern status of the company is not affected.

II. This clause is not applicable to the Company.

III. (a) The Company has granted unsecured loans to four

subsidiaries covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year and yearend balance of such loans were Rs. 2,158.75 lakhs.

(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions for the loans mentioned in para (iii) (a) above, are prima facie not prejudicial to the interest of the Company.

(c) Since the loans mentioned in para (iii) (a) above are

without any fixed repayment schedule, the question of examining the regularity of repayment of the Principal amount and interest thereon, does not arise.

(d) For the same reasons given in para (iii) (c) above, the question of examining the overdue amount and commenting on the reasonableness of the steps taken by the Company for the recovery of such loans does not arise.

(e) The Company has not taken loans from party covered in the register maintained under Section 301 of the Companies Act, 1956, hence para (f) to (g) of the clause 4 (iii) of the order is not applicable to the company.

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 Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. Further, on the basis of our examination of the books and records of the company, and according to the information and explanation 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.

V. (a) In respect of transactions covered under section

301 of the Companies Act, 1956. In our opinion and according to the information given to us, there are no such transactions made in pursuance of contracts or arrangements that needed to be entered into in the register maintained under section 301 of the Companies Act, 1956, hence para (b) of the clause 4 (v) of the order is not applicable to the company.

VI. The Company has not accepted any deposits during the year and consequently the provision of section 58A and 58AA of the Companies Act, 1956 and the rules framed there under are not applicable.

VII. In our opinion, the Company has an internal audit system commensurate with its size and nature of business.

VII. We have been informed that the maintenance of cost records has not been prescribed by the central government under section 209(1) (d) of the Companies Act, 1956.

IX (a) According to the information and explanation given to us the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including income tax, sales tax, wealth tax, customs duty, excise duty, service tax, cess and other material statutory dues applicable.

(b) According to the information and explanation given to us no undisputed statutory dues including income tax, sales tax, wealth tax, customs duty, excise duty, service tax, cess and other material statutory dues applicable were in arrears as at 31.03.2013 for a period of more than six months from the date they became payable.

(c) According to the information and explanation given

to us, there are no dues of income tax, sales tax, customs duty, wealth tax, service tax, excise duty and cess which has been deposited on account of any dispute except the below.

X. The Company does not have any accumulated losses at

Name of the Statute Nature of the Dues Amount disputed Year to which Forum where Rs. in lakhs amount related dispute is pending

Service Tax Service Tax and 58.02 2003 to 2007 CESTAT, Bangalore Interest thereon

the end of the year. The company has not incurred any cash losses for the year under review and immediately preceding such current year.

XI. According to the records of the company examined by us and the information and explanation given to us, the Company has not defaulted regularly in repayment of dues to Financial Institution, Banks and debenture holder. There were some delays in repayment of loans.

XII. We are informed that the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and the securities. Accordingly the provisions of the clause 4 (xii) of the order are not applicable to the company.

XIII. The Company is not a chit fund or a nidhi/mutual benefit fund/society. Accordingly the provisions of the clause

4 (xiii) of the order are not applicable to the company.

XIV. According to the information and explanation given to us the company is not dealing in or trading in shares, securities, debenture and other investments.

XV. According to the information and explanation given to us the company has not given any guarantee for loans taken by others from banks or financial institutions.

XVI. According to the information and explanation given and based on the documents and records produced, on an overall basis, the term loans have been applied for the purpose for which they were obtained.

XVII. According to the information and explanations provided to us and an overall examination of the balance sheet and the cash flow statement of the Company, in our opinion no funds raised on short term have been used for long term investment.

XVIII. According to the information and explanations provided to us, during the year, the Company has made preferential allotment of equity shares as per the provisions of the Companies Act and the rate is not prejudicial to the interest of the company.

XIX. According to the information and explanations provided to us, during the year the Company has not issued any debentures till date.

XX. According to the information and explanations provided to us, during the year the Company has not raised any money by way of public issues. Accordingly the provisions of the clause 4 (xx) of the order are not applicable to the company.

XXI. Based upon the Audit procedures performed and information and explanation given to us, we report that no fraud on or by the company has been noticed or reported during the course of our audit.

For DMKH & Co.

Chartered Accountants

Firm Reg. No. - 116886W



CA. Durgesh Kabra

Place : Navi Mumbai Partner

Date : Novembe 27, 2013 Membership No. : 044075

---

Mar 31, 2012

We have audited the attached balance sheet of ACCENTIA TECHNOLOGIES LIMITED as at 31 st March 2012 and also the Profit & Loss Statement and the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We have conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes, examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In Accordance with the provisions of Section 227 of the Companies Act, 1956, we report that:

1. As required by the Companies (Auditor's Report) Order, 2003, issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 and on the basis of such checks of books and records of the Company as we considered appropriate and according to the information and explanations given to us during the course of audit, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

2. Further to our comments in the annexure referred to above, we report that:

i. We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit.

ii. In our opinion, proper books of account as required by law have been kept by the Company, so far as appears from our examination of these books.

iii. The Balance Sheet and the Profit and Loss Statement referred to in this report are in agreement with the books of account.

iv. In our opinion the Balance Sheet and the Profit and Loss Statement referred to in this report comply with mandatory Accounting Standards referred to in sub section 3C of section 211 of the Companies Act, 1956.

v. On the basis of the information and explanations given to us, and on the basis on the written representations received from the Directors and taken on record, none of the directors of the company is disqualified as on 31 st March, 2012 from being appointed as a Director in terms of clause (g) of sub section (1) of section 274 of the Companies Act, 1956.

vi. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view:

i) In the case of the Balance sheet, of the state of affairs of the Company as at 31 st March 2012.

ii) In the case of the Profit & Loss Statement, of the Profit of the Company for the year ended on that date; and

iii) In the case of the cash flow statement, of the cash flows of the Company for the year ended on that date.

I. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of Fixed Assets on the basis of information available.

(b) As explained to us, all the fixed assets have been physically verified by the management during the year. There is a regular programme of verification 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 physical verification.

(c) In our opinion and according to information and explanation given to us no substantial part of fixed asset has been disposed off by the company during the year and the going concern status of the company is not affected.

II. This clause is not applicable to the Company.

III. (a) The Company has granted unsecured loans to four subsidiaries covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year and year end balance of such loans were Rs. 1,879.76 lakhs.

(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions for the loans mentioned in para (iii) (a) above, are prima facie not prejudicial to the interest of the Company.

(c) Since the loans mentioned in para (iii) (a) above are without any fixed repayment schedule, the question of examining the regularity of repayment of the Principal amount and interest thereon, does not arise.

(d) For the same reasons given in para (iii) (c) above, the question of examining the overdue amount and commenting on the reasonableness of the steps taken by the Company for the recovery of such loans does not arise.

(e) The Company has not taken loans from party covered in the register maintained under Section 301 of the Companies Act, 1956, hence para (f) to (g) of the clause 4 (iii) of the order is not applicable to the company.

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 Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. Further, on the basis of our examination of the books and records of the company, and according to the information and explanation 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.

V. (a) In respect of transactions covered under section 301 of the Companies Act, 1956. In our opinion and according to the information given to us, there are no such transactions made in pursuance of contracts or arrangements that needed to be entered into in the register maintained under section 301 of the Companies Act, 1956, hence para (b) of the clause 4 (v) of the order is not applicable to the company.

VI. The Company has not accepted any deposits during the year and consequently the provision of section 58A and 58AA of the Companies Act, 1956 and the rules framed there under are not applicable.

VII. In our opinion, the Company has an internal audit system commensurate with its size and nature of business.

VII. We have been informed that the maintenance of cost records has not been prescribed by the central government under section 209(1) (d) of the Companies Act, 1956.

IX (a) According to the information and explanation given to us the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including income tax, sales tax, wealth tax, customs duty, excise duty, service tax, cess and other material statutory dues applicable.

(b) According to the information and explanation given to us no undisputed statutory dues including income tax, sales tax, wealth tax, customs duty, excise duty, service tax, cess and other material statutory dues applicable were in arrears as at 31.03.2012 for a period of more than six months from the date they became payable. to us, there are no dues of income tax, sales tax, customs duty, wealth tax, service tax, excise duty and cess which has been deposited on account of any dispute except the below.

(c) According to the information and explanation given

X. The Company does not have any accumulated losses at

Name of the Statute Nature of the Dues Amount disputed Year to which Forum where Rs.in lakhs amount related dispute is pending Service Tax Service Taxand 58.02 2003 to 2007 CESTAT, Bangalore Interest thereon

the end of the year. The company has not incurred any cash losses for the year under review and immediately preceding such current year.

XI. According to the records of the company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues to Financial Institution, Banks and debenture holder.

XII. We are informed that the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and the securities. Accordingly the provisions of the clause 4 (xii) of the order are not applicable to the company.

XIII. The Company is not a chit fund or a nidhi/mutual benefit fund/society. Accordingly the provisions of the clause 4 (xiii) of the order are not applicable to the company.

XIV. According to the information and explanation given to us the company is not dealing in or trading in shares, securities, debenture and other investments.

XV. According to the information and explanation given to us the company has not given any guarantee for loans taken by others from banks or financial institutions.

XVI. According to the information and explanation given and based on the documents and records produced, on an overall basis, the term loans have been applied for the purpose for which they were obtained.

XVII. According to the information and explanations provided to us and an overall examination of the balance sheet and the cash flow statement of the Company, in our opinion no funds raised on short term have been used for long term investment.

XVIILAccording to the information and explanations provided to us the Company has not made any Preferential allotment of equity shares during the year.

XIX. According to the information and explanations provided to us, during the year the Company has not issued any debentures till date.

XX. According to the information and explanations provided to us, during the year the Company has not raised any money by way of public issues. Accordingly the provisions of the clause 4 (xx) of the order are not applicable to the company.

XXI. Based upon the Audit procedures performed and information and explanation given to us, we report that no fraud on or by the company has been noticed or reported during the course of our audit. For DMKH & Co.

Chartered Accountants Firm Reg. No. -116886W

CA. Durgesh Kabra

Place :NaviMumbai Partner

Date: August 27, 2012 Membership No.: 044075

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Mar 31, 2010

We have audited the attached balance sheet of ACCENTIA TECHNOLOGIES LIMITED as at 31 st March 2010 and also the profit & loss account and the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

We have conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes, examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In Accordance with the provisions of Section 227 of the Companies Act, 1956, we report that:

1. As required by the Companies (Auditors Report) Order, 2003, issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956 and on the basis of such checks of books and records of the Company as we considered appropriate and according to the information and explanations given to us during the course of audit, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

2. Further to our comments in the annexure referred to above, we report that:

i. We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit.

ii. In our opinion, proper books of account as required by law have been kept by the Company, so far as appears from our examination of these books.

iii. The Balance Sheet and the Profit and Loss account referred to in this report are in agreement with the books of account.

iv. In our opinion the Balance Sheet and the Profit and Loss account referred to in this report comply with mandatory Accounting Standards referred to in sub section 3C of section 211 of the Companies Act, 1956.

v. On the basis of the information and explanations given to us, and on the basis on the written representations received from the Directors and taken on record, none of the directors of the company is disqualified as on 31 st March, 2010 from being appointed as a Director in terms of clause (g) of subsection (1) of section 274 of the Companies Act, 1956.

vi. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view:

i) In the case of the Balance sheet, of the state of affairs of the Company as at 31 st March 2010.

ii) In the case of the Profit & Loss Account, of the Profit of the Company for the year ended on that date; and

iii) In the case of the cash flow statement, of the cash flows of the Company for the year ended on that date.

ANNEXURE REFERED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE I. (a) The Company has maintained proper records showing full Particulars, including quantitative details and situation of fixed Assets on the basis of information available.

(b) As explained to us, all the fixed assets have been physically verified by the management during the year. There is a regular programme of verification 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 physical verification.

(c) In our opinion and according to information and explanation given to us no substantial part of fixed asset has been disposed off by the company during the year and the going concern status of the company is not affected.

II. In our opinion and according to the information and explanations given to us, in view of the nature of the company, the provision of clause 4(ii) of the order relating to inventory is not applicable to the company.

III. (a) The Company has granted unsecured loanstothree subsidiaries covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year and year end balance of such loans were Rs. 4,89,35,669.

(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions for the loans mentioned in para (iii) (a) above, are prima facie not prejudicial to the interest of the Company.

(c) Since the loans mentioned in para (iii) (a) above are without any fixed repayment schedule, the question of examining the regularity of repayment of the Principal amount and interest thereon, does not arise.

(d) For the same reasons given in para (iii) (c) above, the question of examining the overdue amount and commenting on the reasonableness of the steps taken by the Company for the recovery of such loans does not arise.

(e) The Company has not taken loans from party covered in the register maintained under Section 301 of the Companies Act, 1956, hence para (f) to (g) of the clause 4 (iii) of the order is not applicable to the company.

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 Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. Further, on the basis of our examination of the books and records of the company, and according to the information and explanation 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.

V (a) In respect of transactions covered under section 301 of the Companies Act, 1956. In our opinion and according to the information given to us, there are no such transactions made in pursuance of contracts or arrangements that needed to be entered into in the register maintained under section 301 of the Companies Act, 1956, hence para (b) of the clause 4 (v) of the order is not applicable to the company.

VI. The Company has not accepted any deposits during the year and consequently the provision of section 58A and 58AA of the Companies Act, 1956 and the rules framed there under are not applicable.

VII. In our opinion, the Company has an internal audit system commensurate with its size and nature of business.

VII. We have been informed that the maintenance of cost records has not been prescribed by the central government under section 209(1) (d) of the Companies Act, 1956.

IX (a) According to the information and explanation given to us the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including income tax, sales tax, wealth tax, customs duty, excise duty, service tax, cess and other material statutory dues applicable.

(b) According to the information and explanation given to us no undisputed statutory dues including income tax, sales tax, wealth tax, customs duty, excise duty, service tax, cess and other material statutory dues applicable were in arrears as at 31.03.2010 for a period of more than six months from the date they became payable.

(c) According to the information and explanation given to us, there are no dues of income tax, sales tax, customs duty, wealth tax, service tax, excise duty and cess which has been deposited on account of any dispute except the below.

Name of the Statute Nature of the Dues Amount Disputed Rs.

Income Tax Act, 1961 Income tax and 4,47,43,357/- Interest thereon

ServiceTax Service Tax and 58,01,866/- Interest thereon

Name of the Statue Year to which Forum where amount related Dispute is pending

Income Tax Act,1961 A.Y. 2007-08 Commissioner of Income Tax (Appeal)

Service Tax 2003 to 2007 CESTAT, Bangalore

X. The Company does not have any accumulated losses at the end of the year. The company has not incurred any cash losses for the year under review and immediately preceding such current year.

XI. According to the records of the company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues to Financial Institution, Banks and debenture holder.

XII. We are informed that the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and the securities. Accordingly the provisions of the clause 4 (xii) of the order are not applicable to the company.

XIII. The Company is not a chit fund or a nidhi/mutual benefit fund/society. Accordingly the provisions of the clause 4 (xiii) of the order are not applicable to the company.

XIV. According to the information and explanation given to us the company is not dealing in or trading in shares, securities, debenture and other investments.

XV. According to the information and explanation given to us the company has not given any guarantee for loans taken by others from banks or financial institutions.

XVI. According to the information and explanation given and based on the documents and records produced, on an overall basis, the term loans have been applied for the purpose for which they were obtained.

XVII. According to the information and explanations provided to us and an overall examination of the balance sheet and the cash flow statement of the Company, in our opinion no funds raised on short term have been used for long term investment.

XVIII. According to the information and explanations provided to us the Company has not made any Preferential allotment of equity shares during the year.

XIX. According to the information and explanations provided to us, during the year the Company has not issued any debentures till date.

XX. According to the information and explanations provided to us, during the year the Company has not raised any money by way of public issues. Accordingly the provisions of the clause 4 (xx) of the order are not applicable to the company.

XXI. Based upon the Audit procedures performed and information and explanation given to us, we report that no fraud on or by the company has been noticed or reported during the course of our audit.

For DMKH & Co.

Chartered Accountants Firm Reg. No. - 116886W

CA. Durgesh Kabra

Place :Mumbai Partner

Date :September 6, 2010 Membership No.: 044075

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Mar 31, 2009

1. We have audited the attached Balance Sheet of Accentia Technologies Limited as at March 31, 2009 and also the Profit & Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto.These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based onouraudit.

2. We conducted our audit in accordance with auditing standards generally accepted in India.Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statement. An Audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An Audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003,as amended by the companies (Auditors Report) (Amendment) Order 2004, (together theOrder) issued by the Central Government of India in terms of sub- section (4A) of Section 227 of The Companies Act, 1956. We enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to above, we report that:

(i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit.

(ii) In our Opinion, the Company has kept proper books of accounts as required by law so far as appears from our examination of those books.

(iii) The Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account.

(iv) In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

(v) On the basis of the written representation received from the directors, as on March 31., 2009, and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2009 from being appointed as a Director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

(vi) In our opinion and to the best of our information and according to the explanation given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view and are in conformity with the accounting principles generally accepted in India.

(a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31,2009.

(b) In the case of the Profit & Loss account, of the Profit for the year ended on that date; and

(c) In the case of Cash Flow Statement, of the Cash Flows for the year ended on that date.

I. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation, of fixed Assets on the basis of information available.

(b) We are informed that fixed assets have been physically verified by the management during the year. There is a regular programme of verification 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.

(c) In our opinion and according to information and explanation given to us no fixed assets has been disposed of by the company during the year.

II. (a) In our opinion and according to the information

and explanation given to us, the management has conducted physical verification of inventory at reasonable intervals during the year.

(b) In our opinion and according to the information and explanation given to us, 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) In our opinion and according to the information and explanation given to us, the Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verifications

III (a) The Company has granted loan to two Companies covered in register maintained under section 301 of the Companies Act 1956. The maximum amount involved during the year was Rs. 2,40,50,566 and yearend balance of such parties was Rs. 1,74,86,329.

(b) In our opinion and according to the information and explanations given to us, the terms and conditions for such loans are not prima facie prejudicial to the interest of the Company except to the extent of interest not charged.

(c) The loans granted are in the nature of working capital provided to the subsidiaries. There is no default on the account of repayment of loan on the part of the parties to whom monies have been lent.

(d) There is no overdue amount of loans granted to the parties covered in the register maintained under section 301 of the Companies Act, 1956.

(e) The Company has not taken loans from any parties covered in register maintained under section 301 of the Companies Act, 1956, hence point (f) & (g) is not applicable to the Company.

IV. In our opinion and according to the information and explanation given to us, there are adequate internal control procedures 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 and services. During the course of our audit, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

V. According to the information and explanations given to us, there are no contracts and arrangements the particulars of which need to be entered in to the register maintained under Section 301 of the Companies Act 1956.

VI. The Company has not accepted any deposits from the Public during the year & consequently the provision of section 58A and 58AA of the Companies Act 1956 and the rules framed there under are not applicable.

VII. In our opinion, the Company has an internal audit system, commensurate with the size of the Company and the nature of its business.

VIII. The Central Government has not prescribed maintenance of cost records by the Company under section 209 (1) (d) of the Act.

IX. (a) According to the information and explanation given to us and the records of the Company examined by us, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, Investor Education Protection Fund, employees state insurance, income tax, sales tax, wealth tax, service tax, custom duty, Excise duty, Cess and other material statutory dues applicable to it.

(b) According to the information and explanation given to us, there are no dues of sales tax, income tax, customs duty, wealth tax, excise duty and cess, which have not been deposited on account of anydispute.

X. The Company has no accumulated losses at the end of the financial year and has not incurred any cash loss in the current and immediately preceding financial year.

XI. Based on our audit procedures and on the information and explanation given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to financial institution, bank or debenture holders.

XII. According to the information and explanations given to us and based on the documents and records produced before us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

XIII. The provision of any special statute applicable to chit fund / nidhi / mutual benefit fund / society are not applicable to the Company.

XIV. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments.

XV. According to the information and explanation given to us, the Company has not given any guarantee of loans taken by others from bankorfinancial institutions.

XVI. According to the information and explanation given and based on the documents and records produced, the term loan was applied for the purpose for which the loans were obtained.

XVII. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, in our opinion no funds has been raised on a short-term basis.

XVIII.According to the information and explanations given to us the Company has not made any preferential allotment of equity shares during the year.

XIX. The Company has not issued any debentures till date.

XX. The Company has not raised any funds by way of Public Issue during the year.

XXI. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For Durgesh Kabra & Co. Chartered Accountants CA. Durgesh Kabra Mumbai Proprietor December 1, 2009 Membership No.: 44075