We have audited the attached Balance Sheet of AVON CORPORATION LTD as
 on 31st March, 2012 together with Profit & Loss Account and the Cash 
 Flow Statement for the year ended 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.
 
 As required by the Companies (Auditor''s Report) Order, 2003 (the
 Order) issued by the Central Government of India in terms of
 sub-section (4A) of section 227 of the Companies Act, 1956 and on the
 basis of such checks as we considered appropriate and according to the
 information and explanations given to us, we set out in the Annexure a
 statement on the matters specified in the paragraphs 4 and 5 of the
 said order.
 
 Furtherto our comments in the Annexure referred to in paragraph 3
 above, we report that;
 
 a.  We have 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, the Company has kept proper books of accounts as
 required by Law, so far as appears from our examination of those books;
 
 c.  The Balance Sheet, Profit and Loss Account and Cash Flow Statement
 dealt with by this report are in agreement with the books of accou nt;
 
 d.  In our opinion, the Balance Sheet, Profit And 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, to the extent applicable.
 
 e.  On the basis of the written representations received from Directors
 of the Companies, as on 31st March, 2012 and taken on record by the
 Board of Directors, we report that none of the Directors is
 disqualified as on 31st March, 2012 from being appointed as a director
 in the terms of Clause (g) of sub-section (1) of Section 274 of the
 Companies Act, 1956; and
 
 f.  In our opinion and to the best of our information and according to
 the explanations given to us, the said accounts together with the notes
 thereon given in the prescribed manner the information required by the
 Act and give a true and fair view in conformity with the accounting
 principles generally accepted in India:
 
 1.  In the case of Balance Sheet, of the State of Affairs of the
 Company as on 31st March, 2012;
 
 2.  In the case of Profit And Loss Account, of the Profit of the
 Company for the year ended on that date; and
 
 3.  In the case of Cash Flow Statement, of the cash flows for the year
 ended on that date.
 
                                            
 ANNEXURE TO AUDITOR''S REPORT
 
 Referred to in paragraph 3 of our report of even date on the accounts
 for the year ended 31st March, 2012 of Avon Corporation Limited.
 
 1 (a) The Company has maintained proper records showing full
 particulars including quantitative details and
 
 location of fixed assets.
 
 (b) The Company has a program for phased physical verification of all
 its fixed assets which in our opinion, is reasonable having regard to
 the size of the Company and the nature of its assets. As informed, no
 material discrepancies were noticed on such verification.
 
 (c) The company has not disposed off any substantial part of fixed
 assets during the year.
 
 2 (a) As explained to us, the physical verification of the inventory
 has been conducted by the management at reasonable intervals during the
 year.
 
 (b) In our opinion and according to the information and explanations
 given to us, the procedures for physical verification of inventories
 followed by the management are reasonable and adequate in relation to
 size of the Company and the nature of its business.
 
 (c) The Company is maintaining proper records of inventory. The
 discrepancies noticed during physical verification of inventories as
 compared to book records were not material having regard to the size of
 the operations of the Company and have been dealt with in the books of
 account.
 
 3.  In respect of the loans, secured or unsecured, granted or taken by
 the company to/from companies, firms or other parties covered in the
 register maintained under Section 301 of the Companies Act, 1956:
 
 (a) Based on the information received and the explanation given, the
 rate of interest and the terms and condition of loan taken is prima
 facie not prejudicial to the interest of the Company.
 
 (b) Based on the information received and the explanation given to us,
 the repayment of principal amount is generally regular.
 
 (c) Based on the information received and the explanation given to us,
 there is no overdue repayment of principal amount.
 
 4.  In our opinion, and according to the information and explanations
 given to us, there exists adequate internal control system commensurate
 with the size of the Company and the nature of its business with regard
 to purchases of trading goods, raw materials Including components,
 packing materials, plant and machinery, equipment and other assets and
 with regard to sale of goods and service. During the course of audit,
 we have not observed any continuing failure to correct major weakness
 in the internal controls.
 
 5.  (a) In our opinion, and according to the information and
 explanations given to us, the transactions made in
 pursuance of contracts or arrangements that need to be entered in to
 the register maintained under Section 301 of the Companies Act, 1956,
 for the year have been so entered, (b) There is no transaction of loan
 given to the party covered in the Register Maintained Under Section 301
 of the Companies Act, 1956.
 
 6.  The company has accepted Fixed Deposits of Twenty Crores from the
 public, the directives issued by Reserve Bank of India and the
 provisions of Section 58A and 58AA of the Companies Act, 1956 and rules
 framed thereunder are applicable. We are informed that no order has
 been passed by Company Law Board or National Company Law Tribunal or
 Reserve Bank of India or any court or any other tribunal.
 
 7.  In our opinion, the company has an internal audit system
 commensurate with the size & nature of it''s business.
 
 8.  To the best of our knowledge and as explained, the Central
 Government has not Prescribed the maintenance of cost records under
 Clause (d) of sub-section (1) of section 209 of the Companies Act,
 1956.
 
 9.  In our opinion and according to the information and explanations
 given to us the company is regular in depositing undisputed statutory
 dues including Provident Fund, Employees'' State Insurance, Service tax,
 Custom Duty, Excise Duty, cess and any other statutory dues with the
 appropriate authorities. According to the information and explanations
 given to us, there are no undisputed amounts payable in respect of such
 statutory dues which have remained outstanding as at 31st March 2011
 for a period of more than six months from the date they became payable.
 (Annexure Enclosed)
 
 10. The Company does not have any accumulated losses at the end of the
 financial year. The Company has not incurred cash losses during the
 financial year covered by our audit and in the immediately preceding
 financial year.
 
 11.  As per the information and explanations given to us by the
 management as at the balance sheet date, the Company has defaulted in
 repayment of dues to banks and financial institutions.
 
 12.  In our opinion and according to the information and explanations
 given to us, the Company has not granted any loans and advances on the
 basis of security byway of pledge of shares, debentures and other
 securities.
 
 13.  The Company is not a Chit Fund or a nidhi/mutual benefit
 fund/society. Therefore, the provisions of clause 4 (xiii)ofthe
 Companies Order are not applicable to the Company.
 
 14.  As the Company is not dealing or trading in shares, securities,
 debentures, and other investments, the provision of clause 4 (xiv) of
 the Companies (Auditor''s Report) Order, 2003 is not applicable to the
 company.
 
 15.  As per the information and explanation given to us, the Company
 has not given any guarantee for loans taken from financial institutions
 and /or banks by others.
 
 16.  Based on information and explanation by the management, Term Loans
 were applied for the purpose for which the loans were obtained.
 
 17.  In our opinion and according to the information and explanations
 given to us, and on overall examination of the balance Sheet and the
 Cash flow of the Company, we report that no funds raised on short-term
 basis have been used for long-term investments
 
 18.  According to the information and explanations given to us, the
 Company has not made any preferential allotment of shares to parties
 and companies covered in the register maintained under section 301 of
 the Companies Act, 1956.
 
 19.  The Company has not issued any debentures. Accordingly clause 4
 (xix) of the Companies (Auditor''s Report) Order, 2003 is not applicable
 to the Company.
 
 20.  The Company did not raised any funds through a public issue during
 the year.
 
 21.  On the basis of our examination and according to the information
 and explanations given to us, no fraud on or by the Company, has been
 noticed or reported during the course of our audit.
 
                                            ForATULB.SHAH&CO. 
                                           (Chartered Accountants) 
                                            Registration No. 130818W
 
                                                  Sd/-
                                               AtulShah
 
                                              (Proprietor) 
                                             Membership No. 033137
 
 Place: Mumbai.  
 
 Date: 14/8/2012