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Dabur India Ltd.

BSE: 500096 Sector: Consumer
NSE: DABUR ISIN Code: INE016A01026
BSE 00:00 | 26 Feb 503.35 -5.65
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513.60

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501.20

NSE 00:00 | 26 Feb 503.10 -5.95
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508.50

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OPEN 510.00
PREVIOUS CLOSE 509.00
VOLUME 131060
52-Week high 552.35
52-Week low 385.05
P/E 66.14
Mkt Cap.(Rs cr) 88,962
Buy Price 501.35
Buy Qty 2.00
Sell Price 506.00
Sell Qty 100.00
OPEN 510.00
CLOSE 509.00
VOLUME 131060
52-Week high 552.35
52-Week low 385.05
P/E 66.14
Mkt Cap.(Rs cr) 88,962
Buy Price 501.35
Buy Qty 2.00
Sell Price 506.00
Sell Qty 100.00

Dabur India Ltd. (DABUR) - Auditors Report

Company auditors report

To the Members of Dabur India Limited

Report on the Audit of the Standalone Financial Statements

Opinion

1. We have audited the accompanying standalone financial statements ofDabur India Limited (‘the Company') which comprise the Balance Sheet as at 31March

2020 the Statement of Profit and Loss (including Other ComprehensiveIncome) the Cash Flow Statement and the Statement of Changes in Equity for the year thenended and a summary of the significant accounting policies and other explanatoryinformation.

2. In our opinion and to the best of our information and according tothe explanations given to us the aforesaid standalone financial statements give theinformation required by the Companies Act 2013 (‘Act') in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India including Indian Accounting Standards (‘Ind AS')specified under Section 133 of the Act of the state of affairs of the Company as at 31March 2020 and its profit (including other comprehensive income) its cash flows and thechanges in equity for the year ended on that date.

Basis for Opinion

3. We conducted our audit in accordance with the Standards on Auditingspecified under Section 143(10) of the Act.

Our responsibilities under those standards are further described in theAuditor's Responsibilities for the Audit of the Standalone Financial Statementssection of our report. We are independent of the Company in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India (‘ICAI')together with the ethical requirements that are relevant to our audit of the standalonefinancial statements under the provisions of the Act and the rules thereunder and we havefulfilled our other ethical responsibilities in accordance with these requirements and theCode of Ethics. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion.

Key Audit Matters

4. Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of the standalone financial statements ofthe current period.

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.

5. We have determined the matters described below to be the key auditmatters to be communicated in our report.

Key audit matter How our audit addressed the key audit matter
A. Revenue recognition Our key procedures included but not limited to the following:
Refer note 32 to the standalone financial statements. Revenue of the Company consists primarily of sale of products and is recognized when control of products being sold is transferred to customer and there is no unfulfilled obligation. Revenue is measured at fair value of the consideration received or receivable and is accounted for net of rebates trade discounts. a) Assessed the appropriateness of the Company's revenue recognition accounting policies including those relating to rebates and trade discounts by comparing with the applicable accounting standards;
b) Tested the design and operating effectiveness of the general IT control environment and the manual controls for recognition of revenue calculation of discounts and rebates;
The estimation of discounts incentives and rebates recognized related to sales made during the year is material and considered to be complex and subject to judgments. The complexity mainly relates to various discounts incentives and scheme offers diverse range of market presence and complex contractual agreements/commercial terms across those markets. Therefore there is a risk of revenue being misstated as a result of inaccurate estimates of discounts and rebates. c) Performed test of details:
i. Tested on a sample basis sales transactions to the underlying supporting documentation which includes goods dispatch notes and shipping documents;
ii. Reviewed on a sample basis sales agreements and the underlying contractual terms related to delivery of goods and rebates to assess the Company's revenue recognition policies with reference to the requirements of the applicable accounting standards;
iii. Assessed the Company's process for recording of the accruals for discounts and rebates as at the year-end for the prevailing incentive schemes;
Key audit matter How our audit addressed the key audit matter
The Company also focuses on revenue as a key performance measure which could create an incentive for overstating revenue by influencing the computation of rebates and discounts. iv. Tested on a sample basis discounts and rebates recorded during the year to the relevant approvals and supporting documentation which includes assessing the terms and conditions defined in the prevalent schemes and customer contracts;
Considering the materiality of amounts involved significant judgements related to estimation of rebates and discounts the same has been considered as a key audit matter. v. Obtained supporting documentation for a sample of credit notes issued after the year end to determine whether the transaction was recognized in the correct accounting period; and
vi. Assessed if there is any modification to or other impact on the contracts with customers due to COVID 19 outbreak.
d) Compared the discount incentives and rebates of the current year with the prior year for variance/trend analysis and where relevant conducted further inquiries and testing to corroborate the variances by considering both internal and external benchmarks overlaying our understanding of industry practices and recent changes in economic environment .
e) Assessed the appropriateness of the Company's description of the accounting policy disclosures related to discounts incentives and rebates and whether these are adequately presented in the standalone financial statements.
B. Litigations and claims - provisions and contingent liabilities Our key procedures included but not limited to the following:
Refer note 45A and 48 to the standalone financial statements. The Company is involved in direct indirect tax and other litigations (‘litigations') that are pending with different statutory authorities. a) Assessed the appropriateness of the Company's accounting policies relating to provisions and contingent liability by comparing with the applicable accounting standards;
The level of management judgement associated with determining the need for and the quantum of provisions for any liabilities arising from these litigations is considered to be high. This judgement is dependent on a number of significant assumptions and assessments which involves interpreting the various applicable rules regulations practices and considering precedents in the various jurisdictions. b) Assessed the Company's process and the underlying controls for identification of the pending litigations and completeness for financial reporting and also for monitoring of significant developments in relation to such pending litigations;
This matter is considered as a key audit matter in view of the uncertainty regarding the outcome of these litigations the significance of the amounts involved and the subjectivity involved in management's judgement as to whether the amount should be recognized as a provision or only disclosed as contingent liability in the standalone financial statements. c) Assessed the Company's assumptions and estimates in respect of litigations including the liabilities or provisions recognized or contingent liabilities disclosed in the standalone financial statements. This involved assessing the probability of an unfavorable outcome of a given proceeding and the reliability of estimates of related amounts;
d) Performed substantive procedures on the underlying calculations supporting the provisions recorded;
e) Assessed the management's conclusions through understanding relevant judicial precedents in similar cases and the applicable rules and regulations;
f) Obtained legal opinions from the Company's external legal counsel where appropriate;
g) Engaged subject matter specialists to gain an understanding of the current status of litigations and monitored changes in the disputes if any through discussions with the management and by reading external advice received by the Company where relevant to validate management's conclusions; and
h) Assessed the appropriateness of the Company's description of the accounting policy disclosures related to litigations and whether these are adequately presented in the standalone financial statements.
C. Valuation of investments and impairment thereof Our key procedures included but not limited to the following:
Refer note 7 and 13 to the standalone financial statements. The Company's investment portfolio represents a significant portion of the Company's total assets which primarily consists of: a) Assessed the appropriateness of the relevant accounting policies of the Company including those relating to recognition and measurement of financial instrument by comparing with the applicable accounting standards;
i. Bonds;
ii. Non-convertible debentures; and b) For instrument valued at fair value:
iii. Fixed deposits The aforementioned instruments are valued at amortized cost or fair value through other compressive income (FVTOCI) depending upon the requirements of Ind AS 109 Financial Instruments as summarized below: i. Assessed the availability of quoted prices in liquid markets;
ii. Assessed whether the valuation process is appropriately designed and captures relevant valuation inputs;
iii. Performed testing of the inputs/assumptions used in the valuation; and
1. Instrument valued at amortized cost: iv. Assessed pricing model methodologies and assumptions against industry practice recent changes in economic environment and valuation guidelines
a) Non-convertible debentures;
b) Bond; and
c) Fixed deposits. c) For instrument valued at amortized cost:
2. Instrument valued at fair value through other comprehensive income (‘FVTOCI'): Assessed the instrument for impairment by evaluating if there is any significant increase in credit risk which mainly involves:
a) Bonds; and i. Evaluating the credit rating of individual instrument where relevant to assess if there is any rating downgrade due to recent changes in economic environment;
b) Non- convertible debentures.
This is considered to be a significant area in view of the materiality of amounts involved judgements involved in determining of impairment/ recoverability of instruments measured at amortized cost which includes assessment of market data/conditions and financial indicators of the investee and judgements in selecting the valuation basis and the complexities involved in the valuation of instruments carried at FVTOCI which includes assessment of the available trading yield of relevant instruments and impact of the COVID 19 outbreak on the assumptions considered for such fair valuations. ii. Evaluating the regularity of the interest payment and principal repayment as per agreed plan/term of issuance of instrument where applicable; and
iii. Obtained the valuations of instruments where required;
d) Assessed the appropriateness of the Company's description of the accounting policy and disclosures related to investments and whether these are adequately presented in the standalone financial statements.

Information other than the Standalone Financial Statements andAuditor's Report thereon

6. The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Report on Corporate Governance and Director's

Report but does not include the standalone financial statements andour auditor's report thereon.

Our opinion on the standalone financial statements does not cover theother information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statementsour responsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone financial statements orour knowledge obtained in the audit or otherwise appears to be materially misstated. Ifbased on the work we have performed we conclude that there is a material misstatement ofthis other information we are required to report that fact. We have nothing to report inthis regard.

Responsibilities of Management and those Charged with Governance forthe Standalone Financial Statements

7. The accompanying standalone financial statements have been approvedby the Company's Board of Directors. The Company's Board of Directors isresponsible for the matters stated in

Section 134(5) of the Act with respect to the preparation of thesestandalone financial statements that give a true and fair view of the financial positionfinancial performance including other comprehensive income changes in equity and cashflows of the Company in accordance with the accounting principles generally accepted inIndia including the Ind AS specified under Section 133 of the Act. This responsibilityalso includes maintenance of adequate accounting records in accordance with the provisionsof the Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

8. In preparing the standalone financial statements Management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

9. Those Board of Directors is also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibilities for the Audit of the StandaloneFinancial Statements

10. Our objectives are to obtain reasonable assurance about whether thestandalone financial statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with Standards on Auditing will always detect a materialmisstatement when it exists. Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they could reasonably beexpected to influence the economic decisions of users taken on the basis of thesestandalone financial statements.

11. As part of an audit in accordance with Standards on Auditing weexercise professional judgment and maintain professional skepticism throughout the audit.We also:

Identify and assess the risks of material misstatement of thestandalone financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control;

Obtain an understanding of internal control relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under Section143(3)

(i) of the Act we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls with reference to standalonefinancial statements in place and the operating effectiveness of such controls;

Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by Management;

Conclude on the appropriateness of Management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditionsmay cause the Company to cease to continue as a going concern; and

Evaluate the overall presentation structure and content of thestandalone financial statements including the disclosures and whether the standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation;

12. We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

13. We also provide those charged with governance with a statement thatwe have complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

14. From the matters communicated with those charged with governancewe determine those matters that were of most significance in the audit of the standalonefinancial statements of the current period and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludespublic disclosure about the matter or when in extremely rare circumstances we determinethat a matter should not be communicated in our report because the adverse consequences ofdoing so would reasonably be expected to outweigh the public interest benefits of suchcommunication.

Report on Other Legal and Regulatory Requirements

15. As required by Section 197(16) of the Act based on our audit wereport that the Company has paid remuneration to its Directors during the year inaccordance with the provisions of and limits laid down under Section 197 read withSchedule V to the Act.

16. As required by the Companies (Auditor's Report) Order 2016(‘the Order') issued by the Central Government of India in terms of Section143(11) of the Act we give in the Annexure A a statement on the matters specified inparagraphs 3 and 4 of the Order.

17. Further to our comments in Annexure A as required by Section143(3) of the Act based on our audit we report to the extent applicable that: a) wehave sought and obtained all the information and explanations which to the best of ourknowledge and belief were necessary for the purpose of our audit of the accompanyingstandalone financial statements; b) in our opinion proper books of account as required bylaw have been kept by the Company so far as it appears from our examination of thosebooks; c) the standalone financial statements dealt with by this report are in agreementwith the books of account; d) in our opinion the aforesaid standalone financialstatements comply with Ind AS specified under Section

133 of the Act; e) on the basis of the written representations receivedfrom the Directors and taken on record by the Board of Directors none of the Directors isdisqualified as on 31 March 2020 from being appointed as a Director in terms of Section164(2) of the Act; f) we have also audited the internal financial controls with referenceto standalone financial statements of the Company as on 31 March 2020 in conjunction withour audit of the standalone financial statements of the Company for the year ended on thatdate and our report dated 27 May 2020 as per Annexure B expressed unmodified opinion; andg) 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 as detailed in note 45A to the standalone financial statements hasdisclosed the impact of pending litigations on its financial position as at 31 March2020; ii. the Company did not have any long-term contracts including derivative contractsfor which there were any material foreseeable losses as at 31 March 2020; iii. there hasbeen no delay in transferring amounts required to be transferred to the InvestorEducation and Protection Fund by the Company during the year ended 31 March 2020; and iv.the disclosure requirements relating to holdings as well as dealings in specified banknotes were applicable for the period from 8 November 2016 to

30 December 2016 which are not relevant to these standalone financialstatements. Hence reporting under this clause is not applicable.

ForWalker Chandiok & Co LLP
Chartered Accountants
Firm's Registration No.: 001076N/N500013
Anupam Kumar
Partner
Place : New Delhi Membership No.: 501531
Date : 27 May 2020 UDIN: 20501531AAAACO7385

Annexure A

Based on the audit procedures performed for the purpose of reporting atrue and fair view on the financial statements of the

Company and taking into consideration the information and explanationsgiven to us and the books of account and other records examined by us in the normal courseof audit and to the best of our knowledge and belief we report that:

(i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets comprising‘property plant and equipment' ‘capital work-in-progress'‘investment property' and ‘other intangible assets'.

(b) The fixed assets comprising ‘property plant andequipment' ‘capital work-in-progress' and

‘investment property' have been physically verified by theManagement during the year and no material discrepancies were noticed on suchverification. In our opinion the frequency of verification of the fixed assets isreasonable having regard to the size of the Company and the nature of its assets.

(c) The title deeds of all owned immovable properties (which areincluded under the head ‘property plant and equipment' capitalwork-in-progress and ‘investment property') are held in the name of the Company.In respect of immovable properties in the nature of buildings that have been taken onlease and disclosed under the head property plant and equipment in the standalonefinancial statements the lease agreements are in the name of the Company where theCompany is the lessee as per the lease agreement.

(ii) In our opinion the Management has conducted physical verificationof inventory at reasonable intervals during the year except for goods-in-transit andstocks lying with third parties. For stocks lying with third parties at the year-endwritten confirmations have been obtained by the Management. No material discrepancies werenoticed on the aforesaid verification.

(iii) The Company has not granted any loan secured or unsecured tocompanies firms Limited Liability Partnerships (LLPs) or other parties covered in theregister maintained under Section 189 of the Act. Accordingly the provisions of Clauses3(iii)(a) 3(iii)(b) and 3(iii)(c) of the Order are not applicable. provisions of Sections185 and 186 of the Act in respect of investments and guarantees. Further in our opinionthe Company has not entered into any transaction covered under Section 185 and Section 186of the Act in respect of loans and security.

(v) In our opinion the Company has not accepted any deposits withinthe meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits)Rules 2014 (as amended). Accordingly the provisions of Clause 3(v) of the Order are notapplicable.

(vi) We have broadly reviewed the books of account maintained by theCompany pursuant to the Rules made by the Central Government for the maintenance of costrecords under sub-section (1) of Section 148 of the Act in respect of Company'sproducts and are of the opinion that prima facie the prescribed accounts and recordshave been made and maintained. However we have not made a detailed examination of thecost records with a view to determine whether they are accurate or complete.

(vii) (a) Undisputed statutory dues including provident fundemployees' state insurance income-tax sales- tax service tax duty of customsduty of excise value added tax cess goods and services tax and other material statutorydues as applicable have generally been regularly deposited to the appropriateauthorities though there has been a slight delay in a few cases. Further no undisputedamounts payable in respect thereof were outstanding at the year-end for a period of morethan six months from the date they became payable.

(b) The dues outstanding in respect of income-tax sales-taxservice-tax duty of customs duty of excise and value added tax on account of anydispute are as follows:

Statement of Disputed Dues

Name of the statute Central Sales Tax Act Local Sales Tax Act and Value Added Tax Nature of dues Value Added Tax /Central Sales Tax Amount (in crores) 40.25 Amount paid under protest (in crores) 5.72 Period to which the amount relates 1999-00 to 2017-18 Forum where dispute is pending Assessing Authority / Commissioner's Level / Revisional Board
Tribunal (CESTAT)
63.47 29.60 1997-98 to 1999-00 2001-022005-06 to 2007-08 2009-10 to 2017-18 The Customs Excise and Service Tax Appellate
21.25 1.40 1991-921993-94 to 1994-951996-97 to 1999-00 2006-07 to 2012-13 Hon'ble High Courts
Central Excise Act 1944 Excise duty 20.92 0.32 1994-95 to 1999-00 2004-05 to 2015-16 Commissioner's Level
0.23 - 1995-962000-01 2003-04 to 2007-08 2010-11 to 2017-18 Commissioner (Appeals)
54.91 8.81 1996-97 to 2002-03 2005-06 to 2017-18 CESTAT
39.46 - 2006-07 to 2017-18 Hon'ble High Court
Finance Act 2004 and Service-tax Rules Service tax 0.17 - 2007-08 to 2010-11 CESTAT
The Indian Stamp Act 1899 Stamp duty 15.30 3.83 2007 to 2015 Hon'ble High Courts
The Income- tax Act 1961 Income tax 451.25 * - 2015-16 and 2016-17 Commissioner of Income Tax ("CIT(A)")
122.19 - 2007-08 to 2014-15 Income Tax Appellate Tribunal (ITAT)
0.47 - 2002-032005-06 and 2006-07 Hon'ble High Courts
8.43 - 2006-07 Supreme Court

* includes 349.92 crores pertaining to rectification of mistake filedby the Company on 20 February 2020.

(viii) The Company has not defaulted in repayment of loans orborrowings to any bank or financial institution or government during the year. The Companydid not have any outstanding debentures during the year.

(ix) The Company did not raise moneys by way of initial public offer orfurther public offer (including debt instruments).

In our opinion the term loans were applied for the purposes for whichthe loans were obtained.

(x) No fraud by the Company or on the Company by its officers oremployees has been noticed or reported during the period covered by our audit.

(xi) Managerial remuneration has been provided by the Company inaccordance with the requisite approvals mandated by the provisions of Section 197 of theAct read with Schedule V to the Act.

(xii) In our opinion the Company is not a Nidhi Company. Accordinglyprovisions of Clause 3(xii) of the Order are not applicable.

(xiii) In our opinion all transactions with the related parties are incompliance with Sections 177 and 188 of Act where applicable and the requisite detailshave been disclosed in the financial statements etc. as required by the applicable IndAS.

(xiv) During the year the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures.

(xv) In our opinion the Company has not entered into any non-cashtransactions with the directors or persons connected with them covered under Section 192of the Act.

(xvi) The Company is not required to be registered under

Section 45-IA of the Reserve Bank of India Act 1934.

ForWalker Chandiok & Co LLP
Chartered Accountants
Firm's Registration No.: 001076N/N500013
Anupam Kumar
Partner
Place: New Delhi Membership No.: 501531
Date :27 May 2020 UDIN: 20501531AAAACO7385

Annexure B

Independent Auditor's Report on the internal financial controlswith reference to the standalone financial statements under Clause (i) of Sub-section 3 ofSection 143 of the Companies Act 2013 (‘the Act')

1. In conjunction with our audit of the standalone financial statementsof Dabur India Limited (‘the Company') as at and for the year ended 31 March2020 we have audited the internal financial controls with reference to financialstatements of the Company as at that date.

Responsibilities of Management and Those Charged with Governance forInternal Financial Controls

2. The Company's Board of Directors is responsible forestablishing and maintaining internal financial controls based on the internal financialcontrols with reference to financial statements criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting (‘the GuidanceNote') issued by the Institute of Chartered Accountants of India (‘ICAI').These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of the Company's business including adherence to theCompany's policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditor's Responsibility for the Audit of the Internal FinancialControls with Reference to Financial Statements

3. Our responsibility is to express an opinion on the Company'sinternal financial controls with reference to financial statements based on our audit. Weconducted our audit in accordance with the Standards on Auditing issued by the

ICAI prescribed under Section 143(10) of the Act to the extentapplicable to an audit of internal financial controls with reference to financialstatements and the Guidance

Note issued by the ICAI. Those Standards and the Guidance Note requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls with reference tofinancial statements were established and maintained and if such controls operatedeffectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidenceabout the adequacy of the internal financial controls with reference to financialstatements and their operating effectiveness. Our audit of internal financial controlswith reference to financial statements includes obtaining an understanding of suchinternal financial controls assessing the risk that a material weakness exists andtesting and evaluating the design and operating effectiveness of internal control based onthe assessed risk. The procedures selected depend on the auditor's judgementincluding the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error.

5. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion on the Company's internalfinancial controls with reference to financial statements.

Meaning of Internal Financial Controls with Reference to FinancialStatements

6. A company's internal financial controls with reference tofinancial statements is a process designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles. Acompany's internal financial controls with reference to financial statements includethose policies and procedures that (1) pertain to the maintenance of records that inreasonable detail accurately and fairly reflect the transactions and dispositions of theassets of the company; (2) provide reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorisations of management and directors of thecompany; and (3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could havea material effect on the financial statements.

Inherent Limitations of Internal Financial Controls with Reference toFinancial Statements

7. Because of the inherent limitations of internal financial controlswith reference to financial statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to financial statements to future periods are subject to the riskthat the internal financial controls with reference to financial statements may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.

Opinion

8. In our opinion the Company has in all material respects adequateinternal financial controls with reference to financial statements and such controls wereoperating effectively as at 31 March 2020 based on the internal financial controls withreference to financial statements criteria established by the Company considering theessential components of internal control stated in the Guidance Note issued by the ICAI.

ForWalker Chandiok & Co LLP
Chartered Accountants
Firm's Registration No.: 001076N/N500013
Anupam Kumar
Partner
Place: New Delhi Membership No.: 501531
Date :27 May 2020 UDIN: 20501531AAAACO7385

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