Suitable necessary Remedial Measures to Overcome the Problem.

12 April, 2000

Mr. Ali Hasan

Finance Manager

Alif Paint Industry

Karachi

Dear Sir

Financial  Stringency

Reference is made to letter dated 5 April, 2005 regarding evaluating and reporting the problem of financial stringency with some suggestions. I have made my best efforts to reach on some core issues and suggest the following course of action.

i)                         to meet the operational need short term loan can be borrowed against the available assets.

ii)                       Offer a special discount to debtors for early payments

iii)                     Stock should be purchased on credit against delayed payments if company reputation is not effected

iv)                     Dividend payments can be postponed.

v)                       Offer annual bonuses and shares in profits to the employees if they agree to working on lower rates.

vi)                     Stock holding and purchasing must be properly maintained

vii)                   Company may also go for sale and lease back arrangements to meet its short term liquidity problems.

I am sure my suggestions can bring some positive change in meeting financial stringency, I can reply your further question in this regards

Sincerely

Xxxxxx

Internal Auditor