Garware Offshore Services

We have audited the attached Balance Sheet of GARWARE OFFSHORE SERVICES
 LIMITED as at 31st March, 2009 and also the Profit and Loss Account for
 the year ended on that date and Cash Flow statement 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 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 misstatement. 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 (Auditors 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 on the matters specified in paragraphs 4 and 5 of the said
 Order.
 
 Further to our comments in the Annexure referred to 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 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 appears from our examination of
 those books;
 
 (c) The Balance Sheet and Profit and Loss Account dealt with by this
 report are in agreement with the books of account;
 
 (d) In our opinion, the Balance Sheet and Profit and Loss Account dealt
 with by this report comply with the accounting standards referred to in
 sub-section (3C) of section 211 of the Companies Act, 1956;
 
 (e) On the basis of written representations received from the
 directors, as on 31st March, 2009, and taken on record by the Board of
 Directors, we report that none of the directors is disqualified as on
 31st March, 2009, from being appointed as a director in terms of clause
 (g) of sub-section (1) of section 274 of the Companies Act, 1956;
 
 (f) In our opinion and to the best of our information and according to
 the explanations 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 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 31st March, 2009; and
 
 (ii) in the case of the Profit and Loss Account, of the profit of the
 Company for the year ended on that date;
 
 (iii) in the case of Cash Flow statement, of the cash flows of the
 Company for the year ended on that date.
 
 ANNEXURE TO AUDITORS REPORT
 
 {Referred to in paragraph of our report of the even date}
 
 1 (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) According to the information and explanations given to us, the
 fixed assets have been physically verified by the management during the
 year in a phased periodical manner which, in our opinion, is
 reasonable, having regard to the size of the Company and nature of the
 assets. No material discrepancies were noticed on such verification.
 
 2 (a) As explained to us, the inventories have been physically verified
 by the management at reasonable intervals during the period. In our
 opinion, the frequency of such verification is reasonable having regard
 to the size of the Company and the nature of its business.
 
 (b) In our opinion and according to the information and explanations
 given to us, the procedures of physical verification of inventories
 followed by the management are reasonable and adequate in relation to
 the size of the Company and the nature of the business.
 
 (c) The Company has maintained proper records of inventory. As
 explained to us, there were no material discrepancies noticed on
 physical verification of stocks, as compared to book records.
 
 3 (a) We are informed that the Company has not granted any loans,
 secured or unsecured, to companies, firms or other parties listed in
 the register maintained under Section 301 of the Companies Act, 1956.
 
 (b) The Company has not taken any loans, secured or unsecured, from
 companies, firms or other parties covered in the register maintained
 under section 301 of the Companies Act, 1956.
 
 4 In our opinion and according to the information and explanations
 given to us, there is adequate internal control system commensurate
 with the size of the Company and the nature of its business with
 regards to purchase of inventory and fixed assets and for rendering of
 services. During the course of our audit, no major weaknesses in
 internal control system has been noticed.
 
 5 (a) In our opinion and according to the information and explanations
 given to us, the transactions that need to be entered in the register
 maintained under section 301 of the companies act, 1956, have been so
 entered.
 
 (b) According to the information and explanations given to us, the
 transactions made during the year in pursuance of contracts or
 arrangement entered in the register maintained under section 301 of the
 Companies Act, 1956 have been made at prices which are reasonable
 having regard to the prevailing market prices at the relevant time, in
 the opinion of the management.
 
 6 The Company has not accepted any deposits from the public. Hence the
 requirement of clause (vi) of paragraph 4 of the order is not
 applicable to the Company.
 
 7 In our opinion, the Company has an internal audit system commensurate
 with its size and nature of its business.
 
 8 As informed to us, the maintainence of cost records have not been
 prescribed by the central government under clause (d) of sub-section
 (1) of section 209 of the Companies Act, 1956.
 
 9 (a) According to the records of the Company, the Company is regular
 in depositing with appropriate authorities, any undisputed statutory
 dues including Provindent Fund, Investors Education and Protection
 Fund, Employees State Insurance Scheme, Income Tax, Sales Tax, Wealth
 Tax, Service Tax, Custom Duty, Excise duty, Cess and other statutory
 dues applicable to it.
 
 (b) According to the records of the Company, there is no disputed dues
 pending in any forum in india for any disputed amount of Sales tax,
 Wealth-tax, Service tax, Custom duty, Excise duty, Cess etc.
 
 10 There is no accumulated loss, nor has the Company incurred any cash
 loss during the financial year covered by our audit and in the
 immediately preceding financial year.
 
 11 The Company has repaid all the dues regularly to the financial
 institutions and banks.
 
 12 In our opinion and according to the information and explanation
 given to us, no loan and advances have been granted by the Company on
 the basis of security by way of pledge of shares, debentures and other
 securities.
 
 13 The Company is not a Chit fund, Nidhi or Mutual Benefit Society.
 Hence the requirements of item (xiii) of paragraph 4 of the Order is
 not applicable to the Company.
 
 14 Proper records have been maintained of the transactions and
 contracts of dealing or trading in shares, securities, debentures and
 other investments. Timely entries have also been made therein. The
 shares, securities, debentures and other investments have been held by
 the Company in its own name.
 
 15 According to the information and explanations given to us the
 Company has not given any guarantee for loans taken by others from bank
 or financial institutions, the terms and conditions whereof are prima
 facie prejudicial to the interest of the Company.
 
 16 The term loans raised by the Company during the year have been
 applied for the purpose for which they were obtained.
 
 17 On the basis of an overall examination of the balance sheet and cash
 flows of the company and the information and explanation given to us,
 we report that the company has not utilised any funds raised on short-
 term basis for long- term investments.
 
 18 The Company has not made preferential allotment of shares to parties
 and Companies covered in the Register maintained under section 301 of
 the Act.
 
 19 The Company has not issued any secured debentures. Hence the
 requirements of clause (xix) of paragraph 4 of the Order is not
 applicable to the Company.
 
 20 The Company has not raised any money by way of public issue during
 the year.
 
 21 In our opinion and according to the 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 RAMAN S. SHAH & ASSOCIATES 
                                              CHARTERED ACCOUNTANTS
                                                  Santosh A. Sankhe
 Place : Mumbai                                            (Partner)
 Date :18th August, 2009                               M. No. 100976