1.  We have audited the attached Balance Sheet of SALZER ELECTRONICS
 LIMITED as at 31st March, 2012 together with the annexed Statement of
 Profit and Loss and cash flow statement of the Company for the year
 ended on that date. 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.
 
 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 misstatements. An audit
 includes examining, on a test basis, evidence supporting the amounts
 and disclosures in 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 issued
 by the Central Government in terms of Section 227 (4A) 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 statement referred to in paragraph
 (3) above, we report as follows:
 
 (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 accounts as required by Law have
 been kept by the Company so far as it appears from our examination of
 the books.
 
 (iii) The Balance Sheet, the statement of Profit and Loss and cash flow
 statement dealt with by this report are in agreement with the books of
 account.
 
 (iv) In our opinion and to the best of our information and according to
 the explanations given to us, the statement of Profit and Loss, Balance
 Sheet and Cash flow statement comply with the Accounting Standards
 referred to in Sub-Section (3C) of Section 211 of the Companies Act,
 1956.
 
 (v) On the basis of written representation received from the Directors
 of the Company, as on 31.03.2012 and taken on record by the Board of
 Directors, we report that none of the directors is disqualified as on
 31.03.2012 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, they said accounts give the information
 required by the Companies Act, 1956, in the matter so required and give
 a true and fair view in conformity with the accounting principles
 generally accepted in India.
 
 (a) In the case of Balance Sheet, the state of affairs of the Company
 as at 31st March, 2012 and
 
 (b) In the case of the Statement of Profit and Loss, the profit of the
 company for the year ended on that date and
 
 ( c) In the case of the Cash Flow Statements, the cash flows for the
 year ended on that date.01.
 
 (a) The Company has maintained proper records showing full particulars
 including quantitative details and situation of fixed assets.
 
 (b)The fixed assets have been physically verified by the Management as
 per a phased programme of verification. In our opinion, the frequency
 of verification is reasonable having regard to the size of the Company
 and the nature of its assets.  According to the information and
 explanations given to us no material discrepancies were noticed on such
 verification.
 
 (c) During the year, the Company has not disposed off any significant
 value of Plant and Machinery.
 
 (a)The Management has conducted physical verification of inventory at
 reasonable intervals.
 
 (b)In our opinion, the procedure followed by the Management for such
 physical verifications are reasonable and adequate in relation to the
 size of the Company and nature of its business.
 
 (c)The Company is maintaining proper records of inventory. The
 discrepancies noticed on verification between physical inventories and
 the books and records were not material in relation to the operation of
 the Company and the same have been properly dealt with in the books of
 account.
 
 03.  According to the information and explanations given to us, the
 Company has taken and granted loans, unsecured, from or to Companies,
 firms or other parties, listed in the Register maintained under Section
 301 of the Companies Act, 1956 and the terms and conditions are not
 prima facie prejudicial to the interest of the Company.
 
 04.  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 for the purchase of inventory and fixed assets and for the
 sale of goods.
 
 05.  In respect of transactions entered in the register maintained in
 pursuance of section 301 of the Companies Act, 1956:
 
 (a) To the best of our knowledge and belief and according to the
 information and explanations provided by the Management, we are of the
 opinion that the transactions that need to be entered into the register
 have been so entered.
 
 (b) In our opinion and according to the information and explanations
 given to us, the transactions in pursuance of such contracts or
 arrangements exceeding the value of Rs.5 lakhs have been made at prices
 which are prima facie reasonable and having regard to the prevailing
 market prices at the relevant time.
 
 06.  According to the information and explanations given to us, the
 Company has not accepted any deposits within the meaning of Sections
 58A and 58aa of the Companies Act, 1956.
 
 07.  The Company has an internal audit system, which in our opinion, is
 commensurate with the size and nature of its business.
 
 08.  We have broadly reviewed the books of account maintained by the
 Company pursuant to the rules prescribed by the Central Government for
 maintenance of cost records under Section 209(1)(d) of the Act and are
 of the opinion that prima facie, the prescribed accounts and records
 have been made and maintained. However, we have not made a detailed
 examination of the records.
 
 09.  According to the records of the Company and the information and
 explanations given to us in respect of statutory and other dues:
 
 (a) The Company was regular in depositing Provident Fund and Employees''
 State Insurance dues, Excise duty, Service tax, Customs duty, CESS,
 Investor Education & Protection Fund, Income Tax, Sales Tax and all
 other applicable statutory dues with the appropriate authorities and
 there were no arrears outstanding for a period of more than 6 months as
 at 31st March, 2012.
 
 (b) The Company has no undisputed amounts payable in respect of income
 tax, wealth tax, sales tax, customs duty and excise duty that were
 outstanding, as at 31st March, 2012.
 
 10.  The Company does not have any accumulated losses as at the year
 end nor has it incurred any cash losses during the current and
 immediately preceding financial years.
 
 11.  According to the information and explanations given to us and the
 records examined by us, the Company has not defaulted in repayment of
 dues to financial institutions or banks.
 
 12.  According to the information and explanations given to us and the
 records examined by us, the Company has not granted any loans and
 advances on the basis of security by way of pledge of shares,
 debentures and other securities.
 
 13.  In our opinion and according to the information and explanations
 given to us, the nature of the activities of the Company does not
 attract any special statute applicable to chit fund and nidhi/mutual
 benefit fund/societies.
 
 14.  In our opinion the Company has maintained proper records of the
 transactions and contracts of the investments dealt in by the Company
 and timely entries have been made therein. The investments made by the
 Company are held 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
 banks or financial institutions.
 
 16.  As informed to us, the term loans were utilized by the Company 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 explanations given to
 us, we report that the Company has not utilized any funds raised on
 short term basis for long term investments and vice-versa.
 
 18.  According to the information and explanation given to us during
 the year, the Company has not made preferential allotment of shares to
 parties and companies covered in the register maintained under section
 301 of the companies Act, 1956.
 
 19.  According to the information and explanations given to us and the
 records examined by us, the Company has not issued any debentures that
 were outstanding at any time during the year.
 
 20.  According to the information and explanations given to us and the
 records examined by us, the Company has not raised money by public
 issues during the year.
 
 21.  To the best of our knowledge and belief and according to the
 information and explanations given to us no fraud on or by the Company
 was noticed or reported during the year.
 
                           For Swamy & Ravi For      M/s.JDS Associates
 
                          Chartered Accountants   Chartered Accountants
 
                                   FRN :004317S           FRN : 008735S
 
                           (Sd/-)S.RAVICHANDRAN         (Sd/-)B.JAYARAM
 
                                        Partner                 Partner
 
                           Membership No.023783    Membership No.028346
 
 Coimbatore
 
 26.05.2012