To the Members of Federal Mogul Goetze (India) Limited
Report on the Audit of the Standalone Financial Statements
1. We have audited the accompanying standalone financial statements ofFederal Mogul Goetze (India) Limited (the Company') which comprise the BalanceSheet as at 31 March 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 133of the Act of the state of affairs of the Company as at 31 March 2020 and its profit(including other comprehensive income) its cash flows and the changes in equity for theyear 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 arefurther described in the Auditor's Responsibilities for the Audit of the FinancialStatements section of our report. We are independent of the Company in accordance with theCode of Ethics issued by the Institute of Chartered Accountants of India(ICAI') together with the ethical requirements that are relevant to our auditof the financial statements under the provisions of the Act and the rules thereunder andwe have fulfilled our other ethical responsibilities in accordance with these requirementsand the Code of Ethics. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our opinion.
Emphasis of Matter
4. We draw attention to Note 49 of the accompanying financialstatements which describes the uncertainties due to the outbreak of Covid-19 pandemic andthe management's evaluation of the impact on the financial statements of the Companyas at the balance sheet date. Our opinion is not modified in respect of this matter.
Key Audit Matter
5. 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 thefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters
6. We have determined the matter described below to be the key auditmatters to be communicated in our report.
|Key audit matter ||How our audit addressed the key audit matter |
|Provisions and contingent liabilities relating to litigations As disclosed in Note 37 to the standalone financial statements the Company is involved in various direct taxes indirect taxes labour laws and other litigations (litigations') that are pending with various tax authorities and courts. The Company has recognised provisions aggregating to Rs. 1517.08 lacs and disclosed contingent liabilities of Rs. 5747.70 Lacs related to these litigations. Whether a liability is recognised as a provision or disclosed as a contingent liability in the financial statements is inherently judgmental dependent on a number of significant assumptions and assessments. These include assumptions relating to the likelihood and/or timing of the cash outflows from the business and the interpretation of local laws and pending assessments at various levels of the statute. We placed specific focus on the judgements in respect to these demands against the Company. ||Our audit procedures in relation to the provisions and contingent liabilities relating to litigations included but were not limited to the following: |
| || Obtained an understanding of the management process for: |
| ||- identification of legal and tax matters initiated against the Company |
| ||- assessment of accounting treatment for each such litigation identified under accounting principles of Ind AS 37 |
| ||- Provisions Contingent Liabilities and Contingent Assets and |
| ||- measurement of amounts involved. |
| || Evaluated the design and tested the operating effectiveness of key controls around above process. Test of details included but were not limited to the following- |
| || Obtained an understanding of the nature of litigations pending against the company and discussed the key developments during the year for key litigations with the management and respective legal counsels handling such cases on behalf of the Company. |
| || Assessed the Company's assumptions and estimates in respect of litigations including the liabilities or provisions recognised or contingent liabilities disclosed in the financial statements. This involved assessing the probability of an unfavorable outcome of a given proceeding and the reliability of estimates of related amounts; |
|The amounts involved are potentially significant and due to the range of possible outcomes and considerable uncertainty around the various litigations the determination of the need for creating a provision in the financial statements is inherently subjective/judgmental and therefore is considered to be a key audit matter in the current year || Assessed management's conclusions through discussions held with the in house legal counsel and understanding precedents set in similar cases; |
| || Obtained and evaluating the responses in the independent confirmations obtained from the consultants representing the Company before the various authorities; |
| || For cases represented by consultants reviewed each attorney's response obtained as above to ensure that the conclusions reached by the management are supported by sufficient legal rationale and adequate information is included for the management to determine the appropriate accounting treatment of such cases in the financial statements; |
| || Involved auditor's experts to assess the Company's interpretation and application of relevant tax laws to evaluate the appropriateness of key assumptions used and the reasonableness of estimates in relation to uncertain tax positions taking into account past precedents; |
| || Evaluated the disclosures made relating to provisions and contingent liabilities for their appropriateness. |
We have determined that there are no other key audit matters tocommunicate in our report.
Information other than the financial statements and Auditor Reportthereon
7. The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the Annual Reportbut does not include the standalone financial statements and our auditor's reportthereon. The Annual Report is expected to be made available to us after the date of thisauditor's report.
Our opinion on the standalone financial statements does not cover theother information and we will 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 identified above when it becomesavailable and in doing so consider whether the other information is materiallyinconsistent with the standalone financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated.
When we read the Annual Report if we conclude that there is a materialmisstatement therein we are required to communicate the matter to those charged withgovernance.
Responsibilities of Management and Those Charged with Governance forthe Standalone Financial Statements
8. 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 thepreparation of these standalone financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income changesin equity and cash flows of the Company in accordance with the accounting principlesgenerally accepted in India including the Ind AS specified under section 133 of the Act.This responsibility also includes maintenance of adequate accounting records in accordancewith the provisions of the Act for safeguarding of the assets of the Company and forpreventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.
9. In preparing the financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.
10. Those Board of Directors is also responsible for overseeing theCompany's financial reporting process.
Auditor's Responsibilities for the Audit of the FinancialStatements
11. Our objectives are to obtain reasonable assurance about whether thefinancial 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. Reasonableassurance is a high level of assurance but is not a guarantee that an audit conducted inaccordance with Standards on Auditing will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these financial statements.
12. 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 thefinancial 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 theaudit in order to design audit procedures that are appropriate in the circumstances. Undersection 143(3)(i) of the Act we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls with reference to financialstatements 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 thegoing concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the Company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor'sreport to the related disclosures in the 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;
Evaluate the overall presentation structure and content of thefinancial statements including the disclosures and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation;
13. 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.
14. 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.
15. From the matters communicated with those charged with governancewe determine those matters that were of most significance in the audit of the financialstatements of the current period and are therefore the key audit matters. We describethese 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.
Report on Other Legal and Regulatory Requirements
16. 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.
17. 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.
18. 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) we have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purpose of our auditof the accompanying standalone financial statements;
b) in our opinion proper books of account as required by law have beenkept by the Company so far as it appears from our examination of those books;
c) the standalone financial statements dealt with by this report are inagreement with the books of account;
d) in our opinion the aforesaid standalone financial statements complywith Ind AS specified under section 133 of the Act;
e) on the basis of the written representations received from thedirectors 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 financial statements of the Company as on 31 March 2020 in conjunction with our auditof the standalone financial statements of the Company for the year ended on that date andour report dated 26 June 2020 as per Annexure B expressed an unmodified opinion; and
g) with respect to the other matters to be included in theAuditor's Report in accordance with rule 11 of the Companies (Audit and Auditors)Rules 2014 (as amended) in our opinion and to the best of our information and accordingto the explanations given to us:
i. the Company as detailed in note 37 to the standalone financialstatements has disclosed the impact of pending litigations on its financial position asat 31 March 2020;
ii. the Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses as at 31 March2020;
iii.there has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company during the yearended 31 March 2020; and
iv. the disclosure requirements relating to holdings as well asdealings in specified bank notes were applicable for the period from 8 November 2016 to 30December 2016 which are not relevant to these standalone financial statements. Hencereporting under this clause is not applicable.
| ||For Walker Chandiok & Co LLP |
| ||Chartered Accountants |
| ||Firm's Registration No.: |
| ||001076N/N500013 |
| ||Anamitra Das |
| ||Partner |
| ||Membership No.:062191 |
| ||UDIN: 20062191AAAAGF4066 |
|Place: Gurugram || |
|Date: 26 June 2020 || |
Based on the audit procedures performed for the purpose of reporting atrue and fair view on the financial statements of the Company and taking intoconsideration the information and explanations given to us and the books of account andother records examined by us in the normal course of audit and to the best of ourknowledge and belief we report that:
i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of property plant andequipment intangible assets and right of use assets.
(b) The Company has a regular program of physical verification of itsproperty plant and equipment under which property plant and equipment are verified in aphased manner over a period of three years which in our opinion is reasonable havingregard to the size of the Company and the nature of its assets. In accordance with thisprogram certain property plant and equipment were verified during The year and nomaterial discrepancies were noticed on such verification.
(c) The title deeds of all the immovable properties (which are includedunder the head Property plant and equipment' and Right of useasset') are held in the name of the Company.
(ii) In our opinion the management has conducted physical verificationof inventory at reasonable intervals during the year except for goods-in-transit Nomaterial discrepancies were noticed 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.
(iv) In our opinion the Company has complied with the provisions ofSection 186 in respect of investments. Further in our opinion the Company has notentered into any transaction covered under Section 185 and Section 186 of the Act inrespect of loans guarantees 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 cost records under sub-section (1) ofSection 148 of the Act in respect of Company's products and are of the opinion thatprima facie the prescribed accounts and records have been made and maintained. Howeverwe have not made a detailed examination of the cost records with a view to determinewhether they are accurate or complete.
(vii)(a) The Company is regular in depositing undisputed statutory duesincluding provident fund employees' state insurance income-tax goods and servicetax sales-tax service tax duty of customs duty of excise value added tax cess andother material statutory dues as applicable to the appropriate authorities. Further noundisputed amounts payable in respect thereof were outstanding at the year-end for aperiod of more than 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 ||Nature of dues (Rs. in lacs) ||Amount ||Amount paid under protest (Rs. in lacs) ||Period to which the amount relates ||Forum where dispute is pending |
|Income tax Act 1961 ||Income tax ||16.54 ||- ||1995-1996 and 1996-1997 ||Honorable High Court Delhi |
|Income tax Act 1961 ||Income tax ||432.49 ||- ||1997-98 ||Honorable High Court Delhi |
|Income tax Act 1961 ||Income tax ||17.83 ||- ||1999-00 ||Supreme Court |
|Income tax Act 1961 ||Income tax ||59.68 ||- ||1999-00 ||Income Tax Appellate Tribunal |
|Income tax Act 1961 ||Income tax ||12.34 ||- ||2000-01 ||Honorable Supreme Court |
|Income tax Act 1961 ||Income tax ||2.21 ||- ||2007-08 ||Assessing officer |
|Income tax Act 1961 ||Income tax ||1705.46 ||- ||2010-11 ||Income Tax Appellate Tribunal and Commissioner of Income Tax (Appeals) |
|Income tax Act 1961 ||Income tax ||1.90 ||- ||2011-12 ||Assessing officer |
|Income tax Act 1961 ||Income tax ||63.69 ||- ||2014-15 ||Commissioner of Income Tax (Appeals) |
|Income tax Act 1961 ||Income tax ||786.49 ||- ||2015-16 ||Assessing officer |
|Income tax Act 1961 ||Income tax ||528.89 ||142.15 ||2016-17 ||Commissioner of Income Tax (Appeals) |
|The Central Excise Act1944 ||Excise Duty ||1.17 ||- ||1995-1996 ||Joint Commissioner of Central Excise |
|The Central Excise Act 1944 ||Excise Duty ||1.36 ||- ||2003-2004 ||Joint Commissioner of Central Excise Patiala Punjab |
|The Central Excise Act 1944 ||Excise Duty ||1.76 ||- ||1997-1999 ||Assistant Commissioner of Central Excise |
| || || || || ||Patiala Punjab |
|The Central Excise Act 1944 ||Excise Duty ||1.86 ||- ||1997-98 ||Joint Commissioner of Central Excise Patiala Punjab |
|The Central Excise Act 1944 ||Excise Duty ||6.96 ||- ||1998-1999 ||Joint Commissioner of Central Excise |
|The Central Excise Act 1944 ||Excise Duty ||3.32 ||- ||2001-2002 ||Additional Commissioner of Central Excise |
|Finance Act 1994 (Service Tax) ||Service tax ||86.44 ||25.00 ||2006-2007 ||Central Excise and Service Tax Appellate Tribunal |
|Finance Act 1994 (Service Tax) ||Service tax ||3.55 ||- ||2008-11 ||Assistant Commissioner Bhiwadi Rajasthan |
|Finance Act 1994 (Service Tax) ||Service tax ||13.02 ||- ||2006-08 ||Joint commissioner Jaipur Rajasthan |
|Finance Act 1994 (Service Tax) ||Service tax ||13.56 ||- ||2010-2011 ||Joint commissioner Jaipur Rajasthan |
|Finance Act 1994 (Service Tax) ||Service tax ||28.70 ||- ||2011-2012 ||Joint commissioner Jaipur Rajasthan |
|Finance Act 1994 (Service Tax) ||Service tax ||310.40 ||330.18 ||2008-12 ||Central Excise and Service Tax Appellate Tribunal |
|Finance Act 1994 (Service Tax) ||Service tax ||16.61 ||- ||2009-10 ||Joint Commissioner Jaipur Rajasthan |
|Finance Act 1994 (Service Tax) ||Service tax ||5.81 ||0.58 ||2012-2013 ||Commissioner of Central Excise |
|Finance Act 1994 (Service Tax) ||Service tax ||113.70 ||4.60 ||May 2005 to July 2005 ||Central Excise and Service Tax Appellate Tribunal |
|Finance Act 1994 (Service Tax) ||Service tax ||194.00 ||14.60 ||Oct 2008 to March 2013 ||Central Excise and Service Tax Appellate Tribunal |
|Finance Act 1994 (Service Tax) ||Service tax ||0.09 ||- ||May.2008 To Dec 2008 ||Add. Commissioner Jaipur |
|Finance Act 1994 (Service Tax) ||Service tax ||48.53 ||- ||2013-17 ||Deputy Commissioner |
|West Bengal VAT Act2003 ||Value added tax ||1.56 ||- ||2001-2002 ||Commissioner (Appeals) |
|West Bengal VAT Act2003 ||Value added tax ||1.87 ||- ||2004-2005 ||Commissioner (Appeals) |
|West Bengal VAT Act2003 ||Value added tax ||1.76 ||- ||2006-2007 ||Commissioner (Appeals) |
|West Bengal VAT Act2003 ||Value added tax ||1.18 ||- ||2006-2007 ||Commissioner (Appeals) |
|Karnataka VAT Act 2003 ||Value Added tax ||1.36 ||- ||2007-2008 ||Assistant. Commissioner Bangalore |
|Karnataka VAT Act 2003 ||Value added tax ||13.38 ||- ||2008-09 ||Joint Commissioner Appeal |
|Uttaranchal VAT Act2005 ||Value Added Tax ||33.38 ||33.38 ||2010-11 ||Special Commissioner Objection Hearing |
|Gujarat VAT Demand Act 2003 ||Value Added Tax ||568.25 ||56.83 ||2012-13 ||Special Commissioner Objection Hearing |
|Gujarat CST Demand ||Value Added Tax ||39.28 ||3.93 ||2012-13 ||Special Commissioner Objection Hearing |
|Uttar Pradesh VAT Act 2008 ||Value Added Tax ||4.03 ||- ||2014-15 ||Uttar Pradesh ADC Ghaziabad |
|Andhra Pradesh VAT Act 2005 ||Value added tax ||35.00 ||5.48 ||2013-14 ||Deputy Commissioner Appeal |
|Rajasthan VAT Act 2003 ||Value Added Tax ||91.34 ||- ||2014-17 ||Assistant Commissioner Bhiwadi Rajasthan |
(viii) The Company has not defaulted in repayment of loans orborrowings to any bank during the year. The Company did not have any outstanding loanspayable to any financial institution or government during the year. Further 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) and did not have any term loansoutstanding during the year. Accordingly the provisions of clause 3(ix) of the Order arenot applicable.
(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 paid by the Company in accordancewith the requisite approvals mandated by the provisions of Section 197 of the Act readwith 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-IAof the Reserve Bank of India Act 1934.
|For Walker Chandiok & Co LLP |
|Chartered Accountants |
|Firm's Registration No.: 001076N/N500013 |
|UDIN: 20062191AAAAGF4066 |
|Anamitra Das |
|Membership No.: 062191 |
|Place: Gurugram |
|Date: 26 June 2020 |
Independent Auditor's Report on the Internal Financial Controlsunder Clause (i) of Sub-section 3 of Section 143of the Companies Act 2013 (theAct')
1. In conjunction with our audit of the standalone financial statementsof Federal Mogul Goetze (India) Limited (the Company') as at and for the yearended 31 March 2020 we have audited the internal financial controls with reference tofinancial statements 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 controlover financial reporting criteria established by the Company considering the essentialcomponents of Internal Control stated in the Guidance note on the Audit of InternalFinancial Controls over Financial Reporting (the "Guidance Note") issued by TheInstitute of Chartered Accountants of India (the "ICAI"). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of theCompany's business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable 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 ICAIprescribed under Section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls with reference to financial statements and the Guidance Noteissued by the ICAI. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls with reference to financial statements wereestablished and maintained and if such controls operated effectively in all materialrespects.
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 to financialstatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposesin accordance with generally accepted accounting principles. A company's internalfinancial controls with reference to financial statements include those policies andprocedures that (1) pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany; (2) provide reasonable assurance that transactions are recorded as necessary topermit preparation of financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and (3)provide reasonable assurance regarding prevention or timely detection of unauthorisedacquisition use or disposition of the company's assets that could have a material effecton 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.
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 control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance note issued by the ICAI.
|For Walker Chandiok & Co LLP |
|Chartered Accountants |
|Firm's Registration No.: |
|Anamitra Das |
|Membership No.:062191 |
|UDIN: 20062191AAAAGF4066 |
|Place: Gurugram |
|Date:26 June 2020 |