With reference to paragraph (1) of our report to the Shareholders of HIFUNDA.COM LIMITED of even date, we report that, in our opinion and to the best of our knowledge and belief and as per the information and explanations furnished to us and the books and records examined by us in the normal course of audit:

1. The company has maintained proper records to show full particulars including quantitative details and the situation of fixed assets. Most of the fixed assets have been physically verified by the management during the year and as explained to us, no material discrepancies have been noticed on such verification.

2. None of the fixed assests have been revalued during the year under report.

3. In our opinion, the Company has not taken any loan, secured or unsecured from companies, firms or other parties listed in the registers maintained under Section 301 of the Companies Act, 1956. In view of the provisions of section 370 of the Companies Act, 1956, not being applicable vide the Companies (Amendment) Act, 1999, loans from companies under same management, if any, have not been commented upon.

4. In our opinion, the Company has not granted any loan to Companies, Firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956. In view of the provisions of section 370 of the Companies Act, 1956, not being applicable vide the Companies (Amendment) Act, 1999, loans to companies under same management, if any, have not been commented upon.

5. The parties to whom loans and advances in the nature of loans have been given by the company are repaying the principal amount as stipulated and are also regular in payment of interest, where applicable.

6. There are adequate internal control procedures commensurate with size of the Company and the nature of its business activities with regard to the purchase of various components and other assets.

7. According to the information and explanations given to us, the company has not accepted any deposits under Section 58A of the Companies Act, 1956.

8. The Company has an internal audit system, which is commensurate with the size and nature of its business activities.

9. There are no undisputed amounts payable, in respect of income tax, sales tax, custom duty and excise duty outstanding as at 31st March, 2002 for a period exceeding six months from the date they became payable.

10. The provisions of Employees' Provident Fund Act, 1952 and Employees' State Insurance Act, 1948 are not applicable to the company, as informed to us.

11. No personal expenses of employees or directors have been charged to revenue account, other than those payable under contractual obligations or in accordance with generally accepted business practice.

12. The Company is not a sick industrial company within the meaning of Sick Industrial Companies (Special Provisions) Act, 1985.

13. The other Clauses of the said Order are not applicable to the Company.

For Ranjeet Agarwal & Associates.
Chartered Accountants