REPORT ON REVIEW OF INTERIM FINANCIAL INFORMATION

TO THE MEMBERS

INTRODUCTION

We have reviewed the accompanying interim condensed balance sheet of
Asim Textile Mills Limited as at December 31, 2007 and the related interim condensed profit and loss account, interim condensed cash flow statement and interim condensed statement of changes in equity, together with the notes forming part thereof (here-in-after referred to as “interim financial information”) for the half year then ended. Management is responsible for the preparation and presentation of this interim financial information in accordance with approved accounting standards as applicable in Pakistan. Our responsibility is to express a conclusion on this interim financial information based on our review.

SCOPE OF REVIEW

 We conducted our review in accordance with the International Standard on Review Engagements 2410, “Review of Interim Financial Information Performed by the Independent Auditor of the Entity.” A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matter that might be identified in an audit. Accordingly, we do not express an audit opinion.

 BASIS FOR QUALIFIED OPINION

Based on information provided to us by the management that mark up aggregating to
Rs. 5.998 Million on financial institutions’ lending as referred in Note 4, of the interim condensed financial statements has not been accounted for in the interim condensed financial statements. Due to this current liabilities and accumulated losses are understated and profit for the half year is overstated by that amount.

 QUALIFIED CONCLUSION

 Based on our review, with the exception of the matter described in the preceding paragraph, nothing has come to our attention that causes us to believe that the accompanying interim financial information is not prepared, in all material respects, in accordance with approved accounting standards applicable in Pakistan.

LAHORE :                                                                 (ARSHAD RAHEEM & CO.)        28-02-2008                                                              CHARTERED ACCOUNTANTS