Sat Industries Ltd has informed BSE that in the limited review report of the Company for the quarter ended September 30, 2007 the Auditors of the Company have made the following observations:

“1. Deferred Tax liability for the quarter ended is not provided and;

2. The Auditors have relied upon the management for the Company’s UAE branch’s financial statements, which are not audited by them and which have been consolidated in the results for the quarter ended on September 30, 2007 based on unaudited statements and;

3. The translation of the accounts as per AS-11 will be complied by the Company at the year-end as currently of the consolidation of the results of UAE branch for the quarter ended, the fixed exchange rate of 1 AED=10.93 R. is taken into consideration.

4. The compliance relating to accounting standard-15 regarding employee benefits will be done at the year end.

5. The compliance relating to accounting standard - 29 regarding disclosure on Provisions, Contingent Liabilities & Contingent Assets if any will be done at the year-end.”