s SyOpGores Velo &.co, Yi (622)8910307 _ROAIPAC Ren No. 0001, heb aya Avene Fan (620) 919 mber 22,2612, vl unt Cecembe 31, 2015, 1226 matic eee eation No. GO12-FR-3 croup Bulging a better Pra ‘Noverber 15,2012, vaidunti November 16,2015 working world REPORT OF FACTUAL FINDINGS. The Stockholders and the Board of Directors SSI Group, Ine. 6th Floor, Midland Buendia Building 403 Sen. Gil Puyat Avenue Makati City We have performed the procedures agreed with you and enumerated below with respect to the attached Quarterly Progress Report ended September 30, 2015 on the application of proceeds from the Initial Public Offering (IPO) of SSI Group, Inc. (the Company) on November 7, 2014. The procedures were performed solely to enable the Company to comply with the Philippine Stock Exchange, Inc.'s (PSE) requirement to submit an external auditor's certification on the information ‘being presented by the Company relating to the application of proceeds from the IPO. Our engagement was undertaken in accordance with the Philippine Standards on Related Services 4400, “Engagements to Perform Agreed-Upon Procedures Regarding Financial information” applicable to agreed-upon procedures engagements. These agreed-upon procedures and results thereof are summarized as follows: 1, We obtained a copy of the Planned Use of Proceeds from the offering of the Company's common shares. 2. We obtained the Quarterly Progress on the Application of Proceeds from the IPO (the “Progress Report”) for the quarter ended September 30, 2015 and checked its mathematical accuracy. We also agreed the amounts of capital expenditure disbursements to the related schedules. 3. We obtained the schedule of capital expenditure disbursements and check the mathematical accuracy of the schedules. On a test basis, we traved certain items to the accounting records and supporting documents We report our findings below: 1, With respect to item 1, we obtained a copy of the Planned Use of Proceeds from the offering of the common shares (the Plan) of the Company. We noted from the Plan that the net proceeds from the offering will be used by the Company for store development mainly consisting of the construction of new stores, equity investments in the joint ventures consisting of capital injection pursuant to the obligation under the joint venture agreements, repayment of existing debts and other corporate purposes. With respect to item 2, we found the Progress Report to be mathematically accurate and the amounts are in agreement with the respective schedules provided by management supporting the use of the IPO Proceeds. We also noted that the amounts in the schedules consist ofacquisitions and/or payments recog September 2015. od in the Company's records for the period July 2015 to With respect to item 3, we found the schedules to be in order and mathematically accurate. ‘Ona test basis, we traced capital expenditures and noted no exceptions. 4, The Company also disclosed in the Progress Report that P910,700,014 of the total net proceeds allocated to capital expenditures but have not yet been applied was made available to pay off its short-term and long-term loans, This represents the excess of the allocation for capital expenditures amounting to 2,500,000,000 and the actual capital expenditures as of September 30, 2015 amounting to P1,589,299,986. Because the above procedures do not constitute either an audit or a review made in accordance with Philippine Standards on Auditing or Philippine Standards on Review Engagements, respectively, we do not express any assurance on the use of proceeds from the IPO based on the said standards. Had we performed additional procedures or had we performed an auditor review ofthe financial statements in accordance with Philippine Standards on Auditing or Philippine Standards on Review Engagements, other matters might have come to our attention that would have been reported to you We have no responsibility 1o update this report for events or circumstances occurring after the date of this repor. Our report is solely for the purpose set forth in the first paragraph of this report and for your information and is not to be used for any other purpose or to be distributed to any other parties. This report relates only to the updated report on the Company's use of proceeds from the IPO and items specified above and do not extend to any financial statements of SSI Group, Inc., taken as a whole. SYCIP GORRES VELAYO & CO, BIR Accreditation No. 08-001998-43-2015, October 15, 2015