To the Members of Cyient Limited
Report on the Audit of the Standalone Financial Statements
We have audited the accompanying standalone Ind AS financial statements of CyientLimited ("the Company") which comprise the Balance sheet as at March 31 2020the Statement of Profit and Loss including the statement of Other Comprehensive Incomethe Cash Flow Statement and the Statement of Changes in Equity for the year then endedand notes to the standalone financial statements including a summary of significantaccounting policies and other explanatory information (hereinafter referred to as the"Standalone Financial Statements").
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Standalone Financial Statements give the information requiredby the Companies Act 2013 as amended ("the Act") in the manner so required andgive a true and fair view in conformity with the accounting principles generally acceptedin India of the state of affairs of the Company as at March 31 2020 its profitincluding other comprehensive income its cash flows and the changes in equity for theyear ended on that date.
Basis for Opinion
We conducted our audit of the Standalone Financial Statements in accordance with theStandards on Auditing (SAs) as specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the 'Auditor'sResponsibilities for the Audit of the Standalone Financial Statements' section of ourreport. We are independent of the Company in accordance with the 'Code of Ethics' issuedby the Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of the financial statements under the provisions of the Actand the Rules thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the Code of Ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for our auditopinion on the Standalone Financial Statements.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Standalone Financial Statements for the financial yearended March 31 2020. These matters were addressed in the context of our audit of theStandalone Financial Statements as a whole and in forming our opinion thereon and we donot provide a separate opinion on these matters. For each matter below our description ofhow our audit addressed the matter is provided in that context.
We have determined the matters described below to be the key audit matters to becommunicated in our report. We have fulfilled the responsibilities described in theAuditor's responsibilities for the audit of the Standalone Financial Statements section ofour report including in relation to these matters.
Accordingly our audit included the performance of procedures designed to respond toour assessment of the risks of material misstatement of the Standalone FinancialStatements. The results of our audit procedures including the procedures performed toaddress the matters below provide the basis for our audit opinion on the accompanyingStandalone Financial Statements.
|Key audit matters ||How our audit addressed the key audit matter |
|Impairment assessment of Investments and Intangible assets under development (as described in note 5 and 4 respectively of the Standalone Financial Statements) |
|As at March 31 2020 the Company has investments of Rs. 5107 Mn and intangibles under development of ' 613 Mn. ||Our audit procedures included the following: |
|The investments and intangible assets under development is tested annually for impairment using discounted cash-flow models of recoverable value compared to the carrying value of the assets. A deficit between the recoverable value and carrying value would result in impairment. || We tested the design implementation and operative effectiveness of management's key internal controls over impairment assessments; |
| || Gained an understanding of and evaluated the methodology used by management to prepare its cash flow forecasts and the appropriateness of the assumptions applied. In making this assessment we also evaluated the competence professional qualification objectivity and independence of Company's specialists involved in the process; |
|The inputs to the impairment testing model include: || |
| Projected revenue growth operating margins operating cash-flows and capex during the periods relating to explicit forecasts; || |
| Stable long-term growth rates beyond explicit forecast period and in perpetuity; and || With the assistance of specialists we assessed the assumptions around the key drivers of the cash flow forecasts including discount rates expected growth rates and terminal growth rates used; in consideration of the current and estimated future economic conditions including the impact of COVID-19; |
| Discount rates that represent the current market assessment of the risks specific to the cash generating unit / intangible assets under development taking into consideration the time value of money. || |
|The financial projections basis which the future cash flows have been estimated consider the impact of the economic uncertainties arising from COVID-19 on the discount rates the projected growth rates and terminal values and subjecting these variables to sensitivity analysis. || We assessed the historical accuracy of management's forecasting by comparing actual financial performance to management's previous forecasts. We also analysed the consistency of cash flow forecasts with Management's latest estimates presented to the Board of Directors as part of the budget process; |
|The annual impairment testing is considered a key audit matter because the assumptions on which the tests are based are highly judgmental and are affected by future market and economic conditions which are inherently uncertain and because of the materiality of the balances to the Standalone Financial Statements as a whole. || We assessed the recoverable value headroom by performing sensitivity testing of key assumptions used; |
| || We tested the arithmetical accuracy of the models; |
| || We assessed the related disclosures in Note 4 and 5 to the Standalone Financial Statements. |
|Accuracy of recognition measurement presentation and d Standalone Financial Statements) sclosure of Revenues (as described in note 2 and 17A of the |
|The application of the revenue recognition standard Ind AS 115 - "Revenue from contracts with customers" involves certain key judgements and principles for evaluating various distinctive terms/matters. ||Our audit procedures include the following: |
|Revenue contracts with customers have defined delivery milestones with agreed scope of work and pricing for each milestone depending on the nature of service/industry served. || Evaluated the design implementation and operating effectiveness of management's key internal controls over revenue recognition; |
|The pricing arrangement of these contracts is time and material; fixed bid/unit based etc. || Tested relevant information technology systems' controls relating to contracts and related information used in recording and disclosing revenue; |
| || Substantive testing of sample revenue contracts and performed the following procedures to assess management analysis and impact of Ind AS 115: o Read analyzed and identified the distinct performance obligations in these contracts. |
|Revenue from fixed bid/unit-based contracts where the performance obligation is satisfied over time has been recognised using the percentage of completion method. || |
|Use of the percentage-of-completion method requires the Company to determine the actual efforts or costs expended to date as a proportion of the estimated total efforts or costs to be incurred. ||- Compared these performance obligations with that identified and recorded by the Company. |
| ||- Considered the terms of the contracts and assessed the transaction price including any variable consideration to test revenue. |
|Identification of performance obligations involves high degree of judgement and assessment of contractual terms. Also the estimate of total efforts or remaining efforts to complete fixed bid/unit-based contracts measured using the percentage of completion method involves significantjudgement throughout the period of the contract and is subject to revision as the contract progresses based on the latest available information. || Sample contracts in respect of revenue recorded for time and material contracts were tested using a combination of approved time sheets including customer acceptances and subsequent invoicing; |
| || In respect of fixed price contracts progress towards completion of performance obligation used to compute revenue was verified based on actual cost relative to estimated cost from management analysis and systems or external evidences of progress. Also reviewed cost incurred with estimated cost to identify significant variations and reasons and to verify whether those variations have been considered in estimating the remaining cost to complete the contract; |
|As the revenue recognition involves significant estimates and judgments we regard this as a key audit matter. || Assessed the related disclosure made pursuant to Ind AS 115. |
|Allowance for credit losses for trade receivables including unbilled revenue (as described in note 2 and 9 of the Standalone Financial Statements) || |
|As at March 31 2020 the Company has outstanding trade receivables and unbilled revenue of Rs. 5658 Mn and Rs. 1174 Mn respectively. The Company has determined the allowance for credit losses based on the ageing status and historical loss experience adjusted to reflect current and estimated future economic conditions. In addition to the historical pattern of credit loss the Company have considered the likelihood of increased credit risk and consequential default considering emerging situations due to COVID-19. ||Our audit procedures included the following: |
| || We tested the design implementation and operative effectiveness of management's key internal controls over allowance for credit losses; |
| || We assessed the completeness and accuracy of the information used in the estimation of probability of default and tested historical payment records correspondence with customers credit related information and subsequent collection of the customers' balances; |
|We considered this as key audit matter due to the materiality of the amounts and significant estimates and judgements as stated above. || We performed analysis of ageing of receivables tested the mathematical accuracy and computation of the allowance for credit losses; |
| || We assessed the allowance for expected credit loss made by management including the possible effect from the pandemic relating to COVID-19. |
The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Annual report but does not includethe Standalone Financial Statements and our auditor's report thereon.
Our opinion on the Standalone Financial Statements does not cover the other informationand we do not express any form of assurance conclusion thereon.
In connection with our audit of the Standalone Financial Statements our responsibilityis to read the other information and in doing so consider whether such other informationis materially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact. We have nothing to report in this regard.
Responsibilities of Management for the Standalone Financial Statements
The Company's Board ofDirectors is responsible for the matters stated in section 134(5)ofthe Act with respect to the preparation of these Standalone Financial Statements thatgive a true and fair view of the financial position financial performance including othercomprehensive income cash flows and changes in equity of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 as amended. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and the design implementationand maintenance of adequate internal financial controls that were operating effectivelyfor ensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the Standalone Financial Statements that give a true andfair view and are free from material misstatement whether due to fraud or error.
In preparing the Standalone Financial Statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Company's financialreporting process.
Auditor's Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the StandaloneFinancial Statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these Standalone Financial Statements.
As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the StandaloneFinancial Statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.
Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Act we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls with reference to financial statements in place andthe operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.
Evaluate the overall presentation structure and content of the StandaloneFinancial Statements including the disclosures and whether the Standalone FinancialStatements represent the underlying transactions and events in a manner that achieves fairpresentation.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.
From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the Standalone Financial Statementsfor the financial year ended March 31 2020 and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.
The financial statements of the Company for the year ended March 31 2019 included inthese Standalone Financial Statements have been audited by the predecessor auditor whoexpressed an unmodified opinion on those statements on April 25 2019.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Act we give in the "Annexure 1" a statement on the matters specified inparagraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act we report that:
(a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit;
(b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books;
(c) The Balance Sheet the Statement of Profit and Loss including the Statement ofOther Comprehensive Income the Cash Flow Statement and Statement of Changes in Equitydealt with by this Report are in agreement with the books of account;
(d) In our opinion the aforesaid Standalone Financial Statements comply with theAccounting Standards specified under Section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended;
(e) On the basis of the written representations received from the directors as on March31 2020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2020 from being appointed as a director in terms of Section 164 (2) of theAct;
(f) With respect to the adequacy of the internal financial controls over financialreporting of the Company with reference to these Standalone Financial Statements and theoperating effectiveness of such controls refer to our separate Report in "Annexure2" to this report;
(g) In our opinion the managerial remuneration for the year ended March 31 2020 hasbeen paid / provided by the Company to its directors in accordance with the provisions ofsection 197 read with Schedule V to the Act;
(h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:
i. The Company has disclosed the impact of pending litigations on its financialposition in its Standalone Financial Statements - Refer Note 21A to the StandaloneFinancial Statements;
ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts - Refer Note 14 to the Standalone Financial Statements; and
iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.
For S.R. Batliboi & Associates LLP
ICAI Firm Registration Number: 101049W/E300004
per Vikas Pansari
Membership Number: 093649
Place of Signature: Mumbai
Date: May 7 2020
ANNEXURE 1 TO THE INDEPENDENT AUDITORS' REPORT OF EVEN DATE ON THE STANDALONE FINANCIALSTATEMENTS OF CYIENT LIMITED
Re: Cyient Limited ("the Company")
(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of property plant and equipment.
(b) All property plant and equipment have not been physically verified by themanagement during the year but there is a regular programme of verification which in ouropinion is reasonable having regard to the size of the Company and the nature of itsassets. No material discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and the records examinedby us and based on the examination of the registered sale deed / conveyance deed providedto us we report that the title deeds comprising all the immovable properties of landwhich are freehold are held in the name of the Company as at the balance sheet dateexcept the following:
|Particulars of freehold land ||Gross Block as at March 31 2020 ||Net Block as at March 31 2020 ||Remarks |
| ||(Rs. in million) ||(Rs. in million) || |
|Freehold land located at Nanakramguda Village admeasuring 10 acres. ||4.00 ||4.00 ||Pending completion oflegal formalities relating to conveyance |
In respect of immovable properties of land that have been taken on lease and classifiedas Right of use assets in the financial statements the lease agreements are in the nameof the Company where the Company is the lessee in the agreement. In case of one leaseholdland the Company is yet to receive the title which is pending completion of legalformalities relating to conveyance.
(ii) The Company's business does not involve inventories and accordingly therequirements under paragraph 3(ii) of the Order are not applicable to the Company andhence not commented upon.
(iii) (a) The Company has granted loans to three companies covered in the registermaintained under section 189 of the Act.
In our opinion and according to the information and explanations given to us the termsand conditions of the grant of such loans are not prejudicial to the company's interest.
(b) The Company has granted loans to companies covered in the register maintained undersection 189 of the Act. The schedule of repayment of principal and payment of interest hasbeen stipulated for the loans granted and the repayment/receipts are regular.
(c) There are no amounts of loans granted to companies firms or other parties listedin the register maintained under section 189 of the Act which are overdue for more thanninety days.
(iv) In our opinion and according to the information and explanations given to usprovisions of section 185 and 186 of the Act in respect of loans to directors includingentities in which they are interested and in respect of loans and advances giveninvestments made and guarantees and securities given have been complied with by theCompany.
(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76of the Act and the Companies (Acceptance of Deposits) Rules 2014 (as amended).Accordingly the provisions of clause 3(v) of the Order are not applicable and hence notcommented upon.
(vi) To the best of our knowledge and as explained the Central Government has notspecified the maintenance of cost records under Section 148(1) of the Act for theservices of the Company and hence not commented upon.
(vii)(a) The Company is regular in depositing with appropriate authorities undisputedstatutory dues including provident fund employees' state insurance income-tax valueadded tax duty of custom goods and service tax and other statutory dues applicable toit. The provisions relating to sales tax duty of excise and cess are not applicable tothe Company.
(b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income-tax value addedtax goods and service tax and other statutory dues were outstanding at the year end fora period of more than six months from the date they became payable.
(c) According to the records of the Company the dues of income-tax sales-tax servicetax and value added tax on account of any dispute are as follows:
|Name of Statute ||Nature of Dues ||Forum where Dispute is Pending ||Period to which the Amount Relates ||Amount involved (Rs. in million) ||Amount paid under protest (Rs. in million) |
|Central Sales Tax Act 1956 ||Sales Tax ||Commissioner of Commercial Taxes (Appeals) ||2004-05 to 2009-10 & 2015-16toJun-17 ||17 ||9 |
|Andhra Pradesh Value Added Tax Act 2005 ||Value Added Tax ||Commissioner of Commercial Taxes (Appeals) ||2005-06 to 2009-10 ||4 ||2 |
|Finance Act 1994 ||Service Tax ||Commissioner (Central Excise and Service tax) ||Apr-13 to Jun-17 ||232 ||- |
| || ||Commissioner - Audit (Central Excise and Service tax) ||Oct-13 to Sep-14 ||2 ||1 |
|Income Tax Act 1961 ||Income Tax ||The High Court of Telangana ||1997-98 1999-00 2000-01 & 2002-03 ||18 ||18 |
|Income Tax Act 1961 ||Income Tax ||Commissioner of Income Tax (Appeals) ||2014-15 2016-17 to 2017-18 ||25 ||25 |
|Income Tax Act 1961 ||Income Tax ||Income Tax Appellate Tribunal ||2009-10 2012-13 2013-14 ||25 ||25 |
(viii) The Company did not have any outstanding loans or borrowing dues in respect of afinancial institution or bank or to government or dues to debenture holders during theyear.
(ix) According to the information and explanations given by the management the Companyhas not raised any money by way of public offer/debt instruments and term loans hencereporting under clause (ix) is not applicable to the Company and hence not commented upon.
(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the Company or no fraud on the Companyby the officers and employees of the Company has been noticed or reported during the year.
(xi) According to the information and explanations given by the management themanagerial remuneration has been paid/provided in accordance with the requisite approvalsmandated by the provisions of section 197 read with Schedule V to the Act.
(xii) In our opinion the Company is not a Nidhi Company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.
(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 of theAct where applicable and the details have been disclosed in the notes to the financialstatements as required by the applicable accounting standards.
(xiv) According to the information and explanations given to us and on an overallexamination of the balance sheet the Company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder review and hence reporting requirements under clause 3(xiv) are not applicable tothe Company and hence not commented upon.
(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in section 192 of the Act.
(xvi) According to the information and explanations given to us the provisions ofsection 45IA of the Reserve Bank of India Act 1934 are not applicable to the Company andhence not commented upon.
For S.R. BATLIBOI & ASSOCIATES LLP
ICAI Firm Registration Number: 101049W/E300004
per Vikas Pansari
Membership Number: 093649
Place of Signature: Mumbai
Date: May 7 2020
ANNEXURE 2 TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONE FINANCIALSTATEMENTS OF CYIENT LIMITED
Re: Cyient Limited ("the Company")
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of CyientLimited ("the Company") as of March 31 2020 in conjunction with our audit ofthe Standalone Financial Statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Company's Management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to the Company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Act.
Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting with reference to these Standalone Financial Statementsbased on our audit. We conducted our audit in accordance with the Guidance Note on Auditof Internal Financial Controls Over Financial Reporting (the "Guidance Note")and the Standards on Auditing as specified under section 143(10) of the Act to the extentapplicable to an audit of internal financial controls and both issued by the Institute ofChartered Accountants of India. Those Standards and the Guidance Note require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting withreference to these Standalone Financial Statements was established and maintained and ifsuch controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls over financial reporting with reference to theseStandalone Financial Statements and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting with reference to these StandaloneFinancial Statements assessing the risk that a material weakness exists and testing andevaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgement including theassessment of the risks of material misstatement of the financial statements whether dueto fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the internal financial controls over financialreporting with reference to these Standalone Financial Statements.
Meaning of Internal Financial Controls Over Financial Reporting with reference to theseFinancial Statements
A company's internal financial control over financial reporting with reference to theseStandalone Financial Statements is a process designed to provide reasonable assuranceregarding the reliability of financial reporting and the preparation of financialstatements for external purposes in accordance with generally accepted accountingprinciples. A company's internal financial control over financial reporting with referenceto these Standalone Financial Statements includes those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting withreference to these Standalone Financial Statements
Because of the inherent limitations of internal financial controls over financialreporting with reference to these Standalone Financial Statements including thepossibility ofcollusion or improper management override of controls materialmisstatements due to error or fraud may occur and not be detected. Also projections ofany evaluation of the internal financial controls over financial reporting with referenceto these Standalone Financial Statements to future periods are subject to the risk thatthe internal financial control over financial reporting with reference to these StandaloneFinancial Statements may become inadequate because of changes in conditions or that thedegree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material respects adequate internal financialcontrols over financial reporting with reference to these Standalone Financial Statementsand such internal financial controls over financial reporting with reference to theseStandalone Financial Statements were operating effectively as at March 31 2020 based onthe internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.
For S.R. Batliboi & Associates LLP
ICAI Firm Registration Number: 101049W/E300004
per Vikas Pansari
Membership Number: 093649
Place of Signature: Mumbai
Date: May 7 2020