We have audited the attached Balance Sheet of Vaarad Ventures Limited
 (formerly known as Atco Corporation Ltd.) as on 31st March, 2011 and
 also the Profit & Loss Account of the Company for the year ended on
 that date, annexed hereto and the cash flow statement 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 the 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 of
 our opinion.
 
 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 of India (the act) and on the basis of such checks
 as we considered appropriate and according to the information and
 explanation given to us, we set out in the Annexure a statement on the
 maters specified in paragraphs..
 
 Further to our comments in the Annexure referred to in paragraph one
 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 purpose of our
 audit;
 
 b.  In our opinion, proper books of accounts as required by law have
 been kept by the Company so far as appears from our examination of
 these books;
 
 c.  The Balance Sheet, Profit & Loss Account and Cash Flow Statement
 referred to in this report are in agreement with the books of account.
 
 d.  In our opinion, the Balance Sheet, Profit & Loss Account and Cash
 Flow Statement have been prepared in compliance with the accounting
 standards as prescribed under the provisions of Section 211(3C) of the
 Act.
 
 e.  On the basis of the written confirmation received from the
 Directors and taken on record by, the Board of Directors we report that
 none of the Directors of the Company is disqualified as on 31st 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;
 
 f.  In our opinion and to the best of our information and according to
 the explanations given to us, the said financial statements together
 with the notes thereon and attached thereto, give in the prescribed
 manner, the information required by the Act and also give a true and
 fair view in conformity with the accounting principles generally
 accepted in India:
 
 (i) In so far it relates to the Balance Sheet, of the state of Affairs
 of the Company as at 31st March, 2011 and
 
 (ii) In so far it relates to the Profit and Loss Account, of the profit
 of the Company for the year ended on that date; and
 
 (iii) In so far it relates to the Cash Flow Statement, of the cash flow
 of the Company for the each on that date.
 
 ANNEXURE TO THE AUDITOR''S REPORT
 
 (Referred to in paragraph of the Auditor''s Report of even date to the
 members of Vaarad Ventures Limited (Formerly Known as Atco Corporation
 Ltd ) on the accounts for to period ended 31st March, 2011)
 
 1) (a) The Company has maintained proper records showing full
 particulars including quantitative details and situation of the Fixed
 Assets.
 
 (b) There is a regular program of physical verification, which in our
 opinion is reasonable, having regard to the size of the Company and the
 nature of fixed assets. Material discrepancies Noticed by the
 management during the course of physical verification have been
 properly dealt with.
 
 (c) i) The Company has transferred its business of Packaged Drinking
 water as on going concern on slump sales basis w.e.f. 1st January 2011
 to its wholly owned subsidiary Company Geo Thermal water Ltd which
 includes Gross block of Asset Rs 1,37,44,187/- ii) Company has also
 transferred its business of organized retailing of Industrial &
 Business supplies Stores as on going concern on slump sales basis w.e.f
 closing hours of business of 31st March 2011 to its wholly owned
 subsidiary Company Atco Ltd (Formerly known as Geo water Technologies
 Ltd ) which includes Gross block of Asset Rs 12,16,86,865/- which
 includes Acquired Goodwill of Rs 12,00,00,000/- iii) other than above
 Company has not disposed of substantial part of fixed assets during the
 year.
 
 2) (a) Inventories have been physically verified by the management
 during the year. In our opinion, the frequency of verification is
 reasonable.
 
 (b) The procedures of physical verification of stocks followed by the
 management are reasonable and adequate in relation to the size of the
 Company and the nature of its business.
 
 (c) The Company is maintaining proper records of inventory.  The
 discrepancies Noticed on verification between the physical stocks and
 book records were not material and have been properly dealt with in the
 books of account.
 
 3) (a) The Company has given interest free loan unsecured loan
 amounting to Rs. 362.61 lacs to wholly owned subsidiary of the Company.
 In respect of the said loan, the maximum amount outstanding during the
 year is Rs 362.61 lacs other than this the Company has not granted any
 loans during the year to any parties covered in the register maintained
 under Section 301 of the Companies Act, 1956
 
 (b) The rate of interest and other terms and conditions of the loan
 given were prima facie not prejudicial to the interest of the Company.
 
 (c) The payment of principal and interest was regular during the tenure
 of the loan.
 
 (d) The Company has taken Rent Discount Facility as unsecured loan
 amounting to Rs 300 lacs other than this Company has not accepted any
 loans during the year from the parties covered in the register
 maintained under Section 301 of the Companies Act. 1956.  In view of
 clause 4 (iii)(e) of the Companies (Auditors Report) Order, 2003,
 clauses 4 (iii) (f & g) are not applicable to the Company.
 
 4) In our opinion, and according to the information and explanations
 given to us, there are adequate internal control systems commensurate
 with the size of the Company and the nature of its business with regard
 to the purchase of inventory and fixed assets and with regard to sale
 of goods and services. We have not observed any major weakness in the
 internal control system during the course of our audit.
 
 5) (a) All the transactions with parties covered under Section 301 of
 the Companies Act, 1956 have been properly entered in the register
 maintained under Section 301 of the Act.  (b) In our opinion, and
 according to the information and explanations given to us, the
 transactions of purchase of goods, materials or services and sale of
 goods, materials or services, made in pursuance of contracts or
 arrangements referred to in (a) above and exceeding the value of Rs. 5
 lacs with any party during the year have been made at prices which are
 reasonable having regard to the prevailing market price at the relevant
 time.
 
 6) In our opinion, and according to the information and explanations
 given to us, directives issued by the Reserve Bank of India and the
 provisions of Sections Section 58A and 58AA or any other relevant
 provisions of the Companies Act, 1956 and the rules framed there under,
 to the extent applicable, have been complied with. We are informed by
 the management that no order has been passed by the Company Law Board,
 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 and nature of its business.
 
 8) We are informed that the maintenance of cost records has not been
 prescribed by Central Government under Sec. 209(1)(d) of the Companies
 Act, 1956, in respect of the Company''s product.
 
 9) (a) The Company is regular in depositing undisputed statutory dues
 with the appropriate authority (b) According to the information and
 explanations given to us and the records of the company examined by us
 there are no undisputed statutory dues payable in respect of Provident
 Fund, Investor Education and Protection Fund, Employees State
 Insurance, Income-tax, Sales tax, Custom Duty, Excise Duty Cess which
 are outstanding as at 31st March, 2011 for a period of more than six
 months other than Service Tax which is given below:
 
 Name        Nature of Dues     Rupees      Period       Status
 of the                         in Lacs     to which
 Statute                                     amount
                                             relates
 
 Service    Software Sales      19.17       2009-10     Yet party
 Tax                                                       not
                                                        received
 
 10) The Company has not incurred cash losses during the financial year
 covered by our audit and immediately preceding financial year
 
 11) The Company has not defaulted during the year in repayment of dues
 to any financial Institutions, banks or debenture holders.
 
 12) 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) As the Company is not a chit fund, nidhi, mutual benefit fund or
 society, the provisions of clause 4{xiii) of the Companies (Auditor''s
 Report) Order, 2003 is not applicable to the Company.
 
 14) According to the information and explanations given to us. The
 Company is not dealing or trading in shares, Securities, debentures and
 other investments.
 
 15) The Company has not given any guarantees for loans taken by others
 from Banks or Financial institutions during the year.
 
 16) The Company has not taken any terms loans during the year.
 
 17) According to the information and explanations given to us, the
 Company has not applied short-term borrowings for long-term
 investments.
 
 18) The Company has not made any preferential allotment of shares
 during the year. The Company has converted its 1,65,00,000 fully
 warrants of Rs 2/- each into equity shares of Rs. 2/- each to promoters
 and promoters group on 31st March, 2011 pursuant to the sanctioned
 scheme approved by Hon''ble Board for Industrial and Financial
 Reconstruction (BIFR) order dated 01/10/2007.
 
 19) The Company has not issued any debentures during the year.
 
 20) The Company has not raised any money by way of public issue during
 the year.
 
 21) The Company has not accepted any deposits from the public.
 
 22) As per the information and explanation given to us, no fraud on or
 by the Company has been Noticed or reported during the course of our
 audit.
 
 
                                               For G.C. Patel & Co.
 
                                             Chartered Accountants
 
                                   Firm Registration No. : 113693W
 
                                                    Sd/-
 
                                             (Gnaneshwar C. Patel)
 
 Place : Mumbai                                    Partner
 
 Date : 28th May 2011                        Membership No. 47327