1.  We have audited the attached Balance Sheet of MONEY MATTERS
 FINANCIAL SERVICES LIMITED as at 31st March, 2011, the Profit and Loss
 Account and Cash Flow Statement for the year ended on that date annexed
 thereto. These financial statements arethe responsibilityoftheCompanys
 management. Our responsibility is to express an opinion on these
 financial statements basedonouraudit.
 
 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 misstatement. An audit
 includes examining,onatestbasis, 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 presentation of the
 financial statements. We believe that our audit provides a
 reasonablebasis forour opinion.
 
 3.  As required by the Companies (Auditors Report) Order, 2003 as
 amended by the Companies (Auditors Report Amendment) Order, 2004
 issued by the 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
 aforesaidOrder.
 
 4.  Wereferto:
 
 NoteNo.8(b)ofSchedule22.
 
 Pursuant to the investigations conducted by the Central Bureau of
 Investigation, (the CBI) some of the relevant documents in the
 possession of the Company were seized by the CBI and the reliance is
 placed by the Statutory Auditors on the evidence supporting the
 transactions recordedinthebooksofaccounts.
 
 5.  Further to our comments in the Annexure referred to in Paragraph
 3 above were port that:
 
 i) 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;
 
 ii) In our opinion, proper books of accounts as required by law have
 been kept by the Company so far as appears fromourexaminationofthose
 books;
 
 iii) The Balance Sheet, the Profit and Loss Account and the Cash Flow
 Statement dealt with by this report are in agreement withthe
 books of accounts;
 
 iv) In our opinion, the Balance Sheet and the Profit and Loss Account
 dealt with by this report comply with the Accounting Standards
 referred to insub-section (3C) of Section 211 of the 
 Companies Act,1956;
 
 v) On the basis of written representations received from the Directors,
 as on 31st March, 2011 and taken on record by the Board of Directors,
 we report that none of the Directors are disqualifiedason31st March,
 2011 from being appointed as a Director in terms of clause (g) of
 sub-section (1) of Section 274 of the Companies Act,1956;
 
 vi) Subject to our comments in Paragraph 4 above, in our opinion and to
 the best of our information and accordingtothe explanations giventous,
 the aforesaid accounts read together with Significant Accounting
 Policies and Notes on 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
 
 (a) in the case of the Balance Sheet,of the state of affairs of
 the Company as at 31st March 2011; and
 
 (b) in the case of the Profit and Loss Account, of the Profit
 for the year endedonthatdate.
 
 (c) in case of the Cash Flow Statement, of the Cash flows fortheyear
 ended on that date
 
 Annexure to the Auditors Report
 Referred to in Paragraph 3 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.
 
 (b) As explained to us, the Company has a system of verifying all its
 major fixed assets over a period of three years which is, in our
 opinion, reasonable having regard to the size of the Company and the
 nature of its assets. In accordance with this programme, certain fixed
 assets have been physically verified by the management during the year.
 The discrepancies noticed on such verification were not material and
 have been properly dealt with in the books of accounts.
 
 (c) During the year, the Company has not disposed off a substantial
 /major part of fixed assets so as to affect the going concern
 status of the Company.
 
 (ii) (a) As per the information and explanation given to us bythe
 management,the inventories ofthe Company mainly consists of Shares &
 Securities maintained in electronic (dematerialization) mode and hence
 no physical verificationofinventoriesofthe Company is required. In our
 opinion, clause ii(a) and ii(b) of Paragraph 4 of the Order are not
 applicable to the Company.
 
 (b) On the basis of our examination of the records of inventory, we are
 of the opinion that the Company is maintaining proper records of
 inventory. No discrepancies have been noticed on verification between
 the stocks as per dematerialization mode andthebookrecords.
 
 (iii) (a) The Company has granted unsecured loan and advances in the
 nature of loan to five wholly owned subsidiary parties coveredinthe
 register maintained under Section 301 of the Companies Act, 1956. The
 maximum amount outstanding involved together with balance due atthe end
 ofthe previous year was Rs. 15,904.67 Lacs and the year end balance was Rs.
 9,047.83 Lacs.
 
 (b) In our opinion and according to the information and explanations
 given to us, the rate of interest wherever applicable and other terms
 and conditions of the loans given by the Company, are not prima
 facieprejudicialtothe interestofthe Company.
 
 (c) The principal amounts are repayableondemand and there is no
 repayment schedule. The interest is payable on demand.
 
 (d) In respect of the said loans, the same are repayable on demand and
 therefore the question of overdue amounts does not arise. In respect of
 interest, there is no overdue amount.
 
 (e) The Company has not taken loans, secured or unsecured, from
 Companies, firms or other parties covered in the register maintained
 under Section 301 of the Companies Act, 1956 and hence provisions of
 paragraph 4(iii)(f) to 4(iii)(g) of the afore said Order are not
 applicable to the Company.
 
 (iv) 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, for the
 purchase of inventory and fixed assets and for sale of services.
 During the course of our audit, we have not observed any major
 weakness in such internal controls.
 
 (v) Based on the audit procedures applied by us, and to the best of our
 knowledge and belief and according to the information and explanations
 given to us by the management, we are of the opinion that during the
 year no contracts or arrangements referred to in Section 301 of the
 Companies Act, 1956, have been entered into by the Company. Accordingly
 requirement of clause (v)(a) & (v)(b) of Paragraph 4 of the Order 
 are not applicable to the Company.
 
 (vi) In our opinion and according to the information and explanations
 given to us, the Company has not accepted deposits from the public to
 which provisions of Sections 58A and 58AA or any other relevant
 provisions of the Companies Act, 1956 and the Companies (Acceptance of
 Deposits)Rules, 1975are applicable.
 
 (vii) In our opinion, the internal audit functions carried out during
 the year by a firm of Chartered Accountants appointed by the Management
 has been commensurate with the size of the Company and nature
 of its business.
 
 (viii) As per the information and explanations given to us by the
 management, maintenance of cost records under Section 209(1)(d) of The
 Companies Act, 1956 has not been prescribed by the Company Law Board
 and hence in ouropinion ther equirement of clause (viii) of Paragraph
 4 of the Order is not applicable to the Company.
 
 (ix) (a) According tothe information and explanations given to us by
 the management and according to the records of the Company, 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, service tax,
 wealth tax, and other statutory dues applicable to it.
 
 (b) According tothe information and explanations given to us, no
 undisputed arrears of above statutory dues were outstanding, as at 31st
 March 2011, for a period of more than six months from the date they
 became payable.
 
 (x) The Company does not have accumulated losses at the end of the
 financial year and the Company has not incurred any cash losses during
 the current financial year andintheimmediately preceding financialyear.
 
 (xi) According to the information and explanations given to us, the
 Company has not defaulted in repayment of its duestobanks.
 
 (xii) Based on our examinationof documents and records and according to
 the explanations given to us by the managementweareoftheopinionthat the
 Company has maintained, adequate documents and records in cases where
 it has granted loans and advances on the basis of securityby wayof
 pledgeof shares,debenturesand other securities.
 
 (xiii) As per the information and explanations given to us by the
 management, the Company is not a Chit Fund or a Nidhi Company. Hence in
 our opinion, the provisions of any special statute as specified under
 Clause (xiii) of Paragraph 4 of the Order are not applicable to the
 Company.
 
 (xiv) As per the information and explanations given to us by the
 management and based on our examination of the records and evaluation
 of the related internal controls, we are of the opinion that proper
 records have been maintainedofthetransactionsandcontractsinrespectof
 dealing or trading in shares, securities, debentures and other
 investments and timely entries have been made therein.Wealso report
 that the Company has held all the shares, securities, and other
 investments in its own name except to the extent of exemption under
 section 49 of the CompaniesAct,1956.
 
 (xv) The Companyhas not given any guarantee forloans taken by others
 from Bank or financial institution, and accordingly requirement of
 Paragraph 4(xv) of the aforesaidOrderarenot applicabletotheCompany.
 
 (xvi) In our opinion and according to the information and explanations
 given to us by the management, the Companyhas notavailedofanyterm loan
 duringtheyear.
 
 (xvii) According to the Cash Flow Statement and the Balance Sheet and
 according to the information and explanations given to us and on an
 overall examination of the Balance Sheet of the Company, we are of the
 opinion that no funds raised on short term basis have, prima-facie,
 been used for long term investments. No long-term funds have been used
 to finance short-term assets except permanent working capital.
 
 (xviii) 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 and, therefore, in our opinion
 clause (xviii) of Paragraph 4 of the Order is not applicable.
 
 (xix) During the period covered by our audit report, the Company has
 not issued debentures and therefore clause (xix) of Paragraph
 4 of the Order is not applicable.
 
 (xx) During the period covered by our audit report, the Company has
 not raised money by way of public issues.
 
 (xxi) Based upon the audit procedures performed and as per information
 and explanations given to us by the management, we report that no fraud
 on or by the Companyhas been noticed or reported during the year.
 
 
 
                                                  For and on behalf of
 
                                                         KARNAVAT & CO.
 
                                                 Chartered Accountants
 
                                                  Firm Rgn No. 104863W
 
                                                      Krishna Karundia
 
                                                               Partner
 
 Place: Mumbai                                   Membership No. 036681
 
 Dated: 30th May 2011