To the Membe Rs of LUPIN Limited
Report on the Audit of the Standalone Financial Statements
We have audited the standalone financial statements of Lupin Limited ("theCompany") which comprise the standalone balance sheet as at March 31 2020 and thestandalone statement of profit and loss (including other comprehensive income) standalonestatement of changes in equity and standalone statement of cash flows for the year thenended and notes to the standalone financial statements including a summary of thesignificant accounting policies and other explanatory information.
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 ("Act") in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affai Rs of the Company as at March 31 2020 and profit and other comprehensiveincome changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act. Our responsibilities under those SAs are furtherdescribed in the Auditor's Responsibilities for the Audit of the Standalone FinancialStatements section of our report. We are independent of the Company in accordance withthe Code of Ethics issued by the Institute of Chartered Accountants of India together withthe ethical requirements that are relevant to our audit of the standalone financialstatements under the provisions of the Act and the Rules thereunder and we have fulfilledour other ethical responsibilities in accordance with these requirements and the Code ofEthics.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our opinion on the Standalone financial statements.
Key Audit Matte Rs
Key audit matte Rs are those matte Rs that in our professional judgment were of mostsignificance in our audit of the standalone financial statements of the current period.These matte Rs were addressed in the context of our audit of the standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on
thacQ i-vo a-H-en'c
|The key audit matter description ||How the matter was addressed in audit |
|1. Revenue Recognition: || |
|Refer note 1B(k) of accounting policy and note 39 in standalone financial statements. ||To obtain sufficient and appropriate audit evidence our principal audit procedures included amongst others the following: |
|Revenue from the sale of pharmaceutical products is recognized when control over goods is transferred to a customer. The actual point in time when revenue is recognised varies depending on the specific terms and conditions of the sales contracts entered into with customers. The Company has a large number of custome Rs operating in various geographies and sales contracts with custome Rs have distinct terms relating to the recognition of revenue the right of return and price adjustments. ||- R omparing the accounting policies in respect of revenue recognition and accrual for deductions from gross sales with applicable accounting standards to ensure compliance; |
| ||- Resting design implementation and operating effectiveness of the Company's internal controls including general IT controls and key IT application controls over recognition of revenue and measurement of sales returns; |
|We identified the recognition of revenue from sale of products as a key audit matter considering: ||- Rssessing adequacy of accrual for returns. Performing retrospective testing to identify any bias with respect to these estimates; |
| Revenue is a key performance indicator for the Company. Accordingly there could be pressure to meet the expectations of investo Rs / other stakeholde Rs and / or to meet revenue targets stipulated in performance incentive schemes for a reporting period. We have considered that there is a risk of fraud related to revenue being overstated by recognition in the wrong period or before control has passed. ||- Performing substantive testing of selected samples of revenue transactions recorded during the year-end. For a sample of year-end sales we verified contractual terms of sales invoices / contracts shipping documents and acknowledged delivery receipts for those transactions. - Resting controls over recognition of revenues with respect to research development commercialization licensing and other such arrangements. Testing the |
| Revenue is recognised net of accrual for sales returns. Estimation is required for establishing an accrual based on various factors. These facto Rs include past trend market conditions and introduction of new products. ||recognition of revenue under the said arrangement with focus on the terms of such arrangements in respect to performance obligations. Testing the accuracy of the proportion of revenue in respect of ongoing performance obligations that is deferred; |
|The key audit matter description ||How the matter was addressed in audit |
|The Company routinely ente Rs into research development and commercialization arrangements in respect of new products in the pharmaceutical sector including collaboration with other pharmaceutical companies. This includes in-licensing out-licensing and other such type of arrangements. The nature of these arrangements are inherently complex requiring judgment to be applied in respect of revenue recognition. Considering the complexity of such transactions and extent of judgment involved recognition of revenue from such contracts has also been considered as key audit matter. ||- Assessing appropriateness of non-standard manual journal entries that affect reported revenue of the Company; |
|2. Investment in Subsidiaries: || |
|T he carrying value of investment in subsidiaries as at 31 March 2020 is Rs 51247.3 million. ||To obtain sufficient and appropriate audit evidence our principal audit procedures included amongst others the following: |
|These investments are evaluated at the end of each reporting period to determine any indicato Rs of impairment. If such evidence exists impairment loss is determined and recognised in accordance with note 1B(h) of accounting policies to the standalone financial statements. ||- Testing the design and operating effectiveness of internal controls over impairment assessment including approval of forecasts and valuation methodology; |
| ||- T ssessing the Valuation methodology used and testing the mathematical accuracy of the impairment models; |
|We identified the assessment of impairment indicato Rs and resultant provision if any in respect of investment in subsidiaries as a key audit matter considering: ||- Evaluating the assumptions used including discount rates and terminal growth rates; |
| ||- T hallenging business assumptions used such as sales growth costs success of new products and impact of the potential economic slowdown caused by Covid-19 on these assumptions; |
| T he significance of the value of these investments in the Standalone Balance Sheet. || |
| Werformance and net worth of these entities and || |
| T he degree of judgement involved in determining the recoverable amount of these investments including: ||- T erforming sensitivity; analysis of key assumptions. This includes revenue growth rates costs and the discount rates applied in the valuation models. |
|- Valuation assumptions such as discount rates. || |
|- T usiness assumptions such as sales growth related costs and the resultant cash flows projected to be generated from these investments. ||- Tvaluating past performances where relevant and assessing historical accuracy of the forecasts made; |
|- T ncertainty in businesses across geographies arising from the impact of the Covid-19 pandemic. ||- T onsidering the impact of adjusting events that occurred after the balance sheet date but before the reporting date on the conclusions reached; |
|3. Intangible Assets: || |
|T he carrying value of Intangible Assets including In Process Research and Development (IPR&D) aggregate to Rs 1950.6 million as at 31 March 2020. These assets are evaluated for any indicato Rs of impairment annually. Tefer note no. 1B(f) of accounting policies in respect of impairment. ||To obtain sufficient and appropriate audit evidence our principal audit procedures included amongst others the following: |
|I impairment trigge Rs with respect to intangible assets and IP R&D are assessed annually at each cash generating unit (CGU) level. The recoverable amount of the CGUs being the higher of the value in use and fair value less costs of disposal is compared with the carrying value to identify any impairment. Value in use is usually derived from discounted future cash flows. The discounted cash flow model uses several assumptions. These include estimates of future sales volumes prices operational and selling costs terminal value growth rates potential product obsolescence new product launches and the weighted average cost of capital. The likely impact of the Covid-19 pandemic on these cash also increases the uncertainty involved in these estimates. ||- Testing the design implementation and operating effectiveness of key controls over impairment assessment including approval of forecasts and valuation models used; |
| ||- T ssessing the valuation methodology used and testing the mathematical accuracy of the impairment models; |
| ||- T ssessing identification of CGUs with reference to the guidance in the applicable accounting standards; |
| ||- Tvaluating the valuation assumptions such as discount rates growth in sales probability of success of new products operating and selling costs used. Evaluating the potential impact of economic slowdown caused by Covid-19 pandemic on these assumptions; |
| ||- T erforming sensitivity analysis of key assumptions. This includes revenue growth rates related costs and the discount rate applied in the valuation models. |
|T onsidering the inherent uncertainty complexity and judgment involved and the significance of the value of the assets impairment assessment of intangible assets has been considered as a key audit matter. ||- Tvaluating past performances where relevant and historical accuracy of the forecasts made ; |
| ||- T onsidering the impact of any adjusting events after the balance sheet date but before the reporting on the carrying values of the assets; |
|The key audit matter description ||How the matter was addressed in audit |
|4. Uncertain tax positions (UTPs) and deferred taxes: || |
|T he Company is subject to complexities arising from various tax positions on deductibility of expenses as well as allowability of tax incentives / exemptions. These are subject to periodic challenges by local tax authorities leading to protracted litigations. There are a number of open tax matte Rs under litigation with tax authorities over a number of years. ||To obtain sufficient and appropriate audit evidence our principal audit procedures included amongst others the following: |
| ||- Testing the design and operating effectiveness of the controls over ascertaining completeness of UTPs provisions for current tax and recognition of deferred taxes; |
|T he range of possible outcomes for provisions and contingencies can be wide. Judgement is required to estimate the tax exposures and contingencies. ||- T hallenging the adequacy of related provisions in conjunction with tax specialists by considering changes to business and tax legislation making relevant enquires and reading of correspondence with authorities where relevant; |
|T rovision for current tax valuation of UTPs and recognition of deferred assets / liabilities have been identified as a key audit matter due to the inherent complexity in the underlying tax laws and the extent of judgement involved in developing these estimates. These matte Rs are disclosed in note 46 to the standalone financial statements. ||- Verifying the calculation for current tax provision. Analyzing the rationale for any release increase or continued provision during the year; |
|Refer note 1B(i) in significant accounting policies. ||- T hallenging judgements regarding the recoverability of temporary differences pertaining to deferred tax balances. This includes examining the forecasts and the expected utilization of key temporary differences ; |
| ||- T hallenging judgments with respect to probability of outflow arising from outstanding litigations after considering the status of recent tax assessments audits and enquiries recent judicial pronouncements and judgements in similar matters. Also consider developments in the tax environment and outcome of past litigations. |
The Company's management and Board of Directo Rs are responsible for the otherinformation. The other information comprises the information included in the Company'sannual report but does not include the financial statements and our auditors Rs reportthereon.
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 the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained in the audit or otherwise appea Rs to be materially misstated. If based on thework we have performed we conclude that there is a material misstatement of this otherinformation we are required to report that fact. We have nothing to report in thisregard.
Management's and Board of Director's Responsibility for the Standalone FinancialStatements
The Company's Management and Board of Directo Rs are responsible for the matte Rsstated in section 134(5) of the Act with respect to the preparation of these standalonefinancial statements that give a true and fair view of the state of affairs profit andother comprehensive income changes in equity and cash flows of the Company in accordancewith the accounting principles generally accepted in India including the IndianAccounting Standards (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 Judgements and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring accuracy and completeness of the accounting records relevant tothe preparation and presentation of the standalone financial statements that give a trueand fair view and are free from material misstatement whether due to fraud or error.
In preparing the standalone financial statements the Management and Board of DirectoRs are responsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matte Rs related to going concern and using the going concernbasis of accounting unless the Board of Directors either intends to liquidate the Companyor to cease operations or has no realistic alternative but to do so.
The Board of Directors is 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 judgement andmaintain professional skepticism throughout the audit. We also:
I dentify 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.
O btain 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.
Ovaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures in the standalone financial statementsmade by the Management and Board of Directors.
Oonclude on the appropriateness of the Management and Board of Directors use ofthe going 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's report to the related disclosures in the standalone financial statements orif such disclosures are inadequate to modify our opinion. Our conclusions are based onthe audit evidence obtained up to the date of our auditor's report. However future eventsor conditions may cause the Company to cease to continue as a going concern.
Ovaluate the overall presentation structure and
content of the standalone financial statements including the disclosures and whetherthe standalone financial statements represent the underlying transactions and events in amanner that achieves fair presentation.
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 statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. Os required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of section 143 (11) of the Act we give in the"Annexure A" a statement on the matters specified in paragraphs 3 and 4 of theOrder to the extent applicable.
2. (A) As required by Section 143(3) of the Act we
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 standalone balance sheet the standalone statement of profit (including othercomprehensive income) the standalone statement of changes in equity and the standalonestatement of cash flows dealt with by this Report are in agreement with the books ofaccount.
d) In our opinion the aforesaid standalone financial statements comply with the Ind ASspecified under section 133 of the Act.
e) O n the basis of the written representations received from the directors as on
March 31 2020 taken on record by the Board of Directors none of the directors isdisqualified as on March 31 2020 from being appointed as a director in terms of Section164(2) of the Act.
f) Oith respect to the adequacy of the internal financial controls with reference tofinancial statements of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure B".
(B) 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 in our opinionand to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations as at March 31 2020 onits financial position in its standalone financial statements - Refer Note 36 to thestandalone financial 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 including derivative contracts.
iii. Ohere has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.
iv. The disclosures in the standalone financial statements regarding holdings as wellas dealings in specified bank notes during the period from 8 November 2016 to 30 December2016 have not been made in these financial statements since they do not pertain to thefinancial year ended 31 March 2020.
(C) With respect to the matter to be included in the Auditor's Report under section197(16):
I n our opinion and according to the information and explanations given to us theremuneration paid by the company to its directors during the current year is in accordancewith the provisions of Section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under Section 197(16) which arerequired to be commented upon by us.
For B S R & Co. LLP
Firm Registration No. 101248 W/W-100022
Place: Mumbai Partner
Date: 28 May 2020 Membership No. 113156
Annexure A to the Independent Auditor's
Report - 31 March 2020
(Referred to our report of even date)
(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of the fixed assets.
(b) The Company has a regular program of physical verification of its fixed assets bywhich all fixed assets are verified in a phased manner over a period of three years.
In accordance with this program a portion of the fixed assets has been physicallyverified by the management during the year and no material discrepancies have been noticedon such verification. In our opinion this periodicity of physical verification isreasonable having regard to the size of the Company and the nature of its assets.
(c) According to the information and explanations given to us and based on theexamination of the registered sale deed / transfer deed / conveyance deed / sharecertificate / other documents evidencing title we report that the title deeds ofimmovable properties of land and building which are freehold as disclosed in Note 2 tothe standalone financial statements are held in the name of the Company except for thefollowing:
|Particulars of the land and building ||Gross Block (As at 31.03.2020) ||Net Block (As at 31.03.2020) ||Remarks |
|Freehold land located in Maharashtra admeasuring 7 Hectare and 70.91 Acre ||29.6 ||29.6 ||The title deeds are in the name of the erstwhile Company that was amalgamated with the Company pursuant to the Scheme of amalgamation sanctioned by the Hon'ble Bombay High Court |
|Freehold building located in Maharashtra admeasuring 8038 sqft ||133.9 ||89.1 ||The title deeds are in the name of erstwhile Company that was amalgamated with the Company pursuant to the Scheme of amalgamation sanctioned by the Hon'ble Bombay High Court |
In respect of immovable properties of land and buildings that have been taken on leaseand disclosed as fixed asset in Note 2 to the standalone Ind AS financial statements thelease agreements are in the name of the Company except the following:
|Particulars of the building ||Gross Block (As at 31.03.2020) ||Net Block (As at 31.03.2020) ||Remarks |
|Leasehold building located in Delhi admeasuring 1628 sqft ||2.8 ||2.3 ||The title deeds are in the name of erstwhile Company that was amalgamated with the Company pursuant to the Scheme of amalgamation sanctioned by the Hon'ble Bombay High Court |
In respect of immovable properties of land and buildings which are disclosed as fixedasset in the standalone Ind AS financial statements the original documents for thefollowing assets are not available for verification.
|Particulars of the land and building ||Gross Block (As at 31.03.2020) ||Net Block (As at 31.03.2020) |
|Building located in Maharashtra ||7.5 ||5.0 |
|Land located in Uttarakhand ||0.3 ||0.3 |
(ii) I inventories apart from goods in transit and inventories lying withoutside parties have been physically verified by the Management during the year and thediscrepancies noticed on such verification between the physical stock andbook records were not material. In our opinion the frequency of such verificationis reasonable. Inventories lying with outside parties has been substantiallyconfirmed by them as at the year-end and no material discrepancies were noticed in respectof such confirmations.
(iii) According to information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under section 189 of theCompanies Act 2013 ('the Act'). Accordingly paragraph 3(iii) of the Order is notapplicable to the Company.
(iv) According to the information and explanation given to us the Company has compliedwith the provisions of Section 185 and 186 of the Act in respect of theinvestments made and guarantees provided as applicable. The Company has not granted anyloans or provided any security to the parties covered under Section 185 and 186 of theAct.
(v) According to the information and explanations given to us the Company has notaccepted any deposits as per the directives issued by the Reserve Bank of India under theprovisions of Sections 73 to 76 or any other relevant provisions of the Act and the rulesframed there under. Accordingly paragraph 3(v) of the Order is not applicable to theCompany.
(vi) We have broadly reviewed the records maintained by the Company pursuant to therules prescribed by Central Government for maintenance of
cost records under Section 148 (1) of the Act and are of the opinion that prima faciethe prescribed accounts and records have been made and maintained. However we have notmade a detailed examination of the records.
(vii) (a) According to the information and
explanations given to us and on the basis of our examination of the records of theCompany amounts deducted / accrued in the books of account in respect of undisputedstatutory dues including Provident fund EmployeesRs state insurance Income tax duty ofCustoms Goods and Service tax Cess and other material statutory dues have generally
been regularly deposited during the year by the Company with the appropriateauthorities.
According to the information and explanations given to us no undisputed amountspayable in respect of Provident fund EmployeesRs state insurance Income tax dutyof Customs Goods and Service tax Cess and other material statutory dues were in arrearsas at 31 March 2020 for a period of more than six months from the date they becamepayable.
(b) According to the information and explanations given to us there are no dues ofIncome tax Sales Tax Value added tax Service tax duty of Customs Goods and Servicetax duty of Excise and Cess which have not been deposited with the appropriateauthorities on account of any dispute other than those mentioned in Annexure I to thisreport.
(viii) According to the information and explanations given to us the Company has notdefaulted in repayment of loans or borrowings to banks or government. The Company has nottaken any loans or borrowings from financial institutions and has not issued anydebentures.
(ix) The Company has not raised any money by way of initial public offer furtherpublic offer (including debt instruments) and term loans during the year. Accordinglyparagraph 3(ix) of the Order is not applicable to the Company.
(x) During the course of our examination of the books and records of the companycarried out in accordance with generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such cases by theManagement.
(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration
in accordance with the requisite approvals mandated by the provisions of Section 197read with Schedule V to the Act.
(xii) According to the information and explanations given to us the Company is not a Nidhicompany and the Nidhi Rules 2014 are not applicable to it. Accordinglyparagraph 3(xii) of the Order is not applicable to the Company.
(xiii) According to the information and explanations given to us and based on ourexamination
of the records of the Company transactions with related parties are in compliance withthe provisions of Sections 177 and 188 of the Act where applicable. The details of suchrelated party transactions have been disclosed in the standalone Ind AS financialstatements as required under Indian Accounting Standard (Ind AS) 24 Related PartyDisclosures specified under Section 133 of the Act read with the relevant rules issuedthereunder.
(xiv) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. Accordingly paragraph 3(xiv) of the Order is not applicable to the Company.
(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with its directors or persons connected with them. Accordingly paragraph3(xv) of the Order is not applicable to the Company.
(xvi) In our opinion and according to the information and explanations given to us theCompany
is not required to be registered under Section 45-IA of the Reserve Bank of India Act1934. Accordingly paragraph 3 (xvi) of the Order is not applicable to the Company.
| ||For B S R & Co. LLP Chartered Accountants Firm Registration No. 101248 W/W-100022 |
|Place: Mumbai Date: 28 May 2020 ||Venkataramanan Vishwanath Partner Membership No. 113156 UDIN: 20113156AAAACS48843 |
Amounts of dues of Income tax sales tax Value added tax Service tax duty ofCustoms duty of Excise which have not been deposited with the appropriate authorities onaccount of any dispute.
|Name of the Statute ||Nature of Dues ||Forum where dispute is pending || |
Period to which amount relates
|Amount demanded ||Amount unpaid |
|(Rs million) ||(Rs million) |
|Income tax Act 1961 ||Income tax ||Commissioner of Income tax (Appeals) ||2005-2015 ||1779.9 ||940.1 |
|High Court ||1993-94 ||16.3 ||16.3 |
|Central Excise Act 1944 ||Excise duty De-bonding matters ||Customs Excise and Service Tax Appellate Tribunal (CESTAT) ||2010 & 2012 ||371.1 || |
|Service Tax Matters ||Customs Excise and Service Tax Appellate Tribunal (CESTAT) ||2005-08 ||55.1 ||55.1 |
|Service Tax Matters ||High Court ||2005-06 ||22.2 ||22.2 |
|Central and various StatesRs Sales Tax Acts and various StatesRs Value Added Tax Acts ||Sales tax and Value added tax ||Sales Tax Tribunal ||2000-01 || |
|2003 -06 |
|Supreme Court ||2000-01 ||0.5 ||0.5 |
|High Court ||2002-03 || |
|Commissioner of Sales Tax (Appeal) ||2001-03 || |
|2005 -09 |
|Joint Commissioner ||2001-2004 || |
|Deputy Commissioner ||1994-95 || |
|Additional Commissioner ||1994-95 || |
|Assistant Commissioner ||2003-04 ||0.3 ||- |
|The Customs Act 1962 ||Customs duty ||Customs Excise and Service Tax Appellate Tribunal (CESTAT) ||2010-2011 ||0.8 ||0.8 |
Annexure - I to the Independent Auditor's Report - 31 March 2020
Annexure B to the Independent Auditor's Report on the standalone financial statementsof Lupin Limited for the period ended March 31 2020.
Report on the internal financial controls with reference to the aforesaid standalonefinancial statements under Clause (i) of Sub-section 3 of Section 143 of the CompaniesAct 2013
(Referred to in paragraph 2(A)(f) under 'Report on Other Legal and RegulatoryRequirementsRs section of our report of even date)
We have audited the internal financial controls with reference to financial statementsof Lupin Limited ("the Company") as of March 31 2020 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.
In our opinion the Company has in all material respects adequate internal financialcontrols with reference to financial statements and such internal financial controls wereoperating effectively as at March 31 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 on Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India (the "Guidance Note").
Management's Responsibility for Internal Financial Controls
The Company's management and the Board of Directors are responsible for establishingand maintaining internal financial controls 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. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013 (hereinafter referred to as"the Act").
Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to financial statements based on our audit. We conducted our auditin accordance with the Guidance Note and the Standards on Auditing prescribed undersection 143(10) of the Act to the extent applicable to an audit of internal financialcontrols with reference to financial statements.
Those Standards and the Guidance Note require that we comply with ethical requirementsand plan and perform the audit to obtain reasonable assurance about whether adequateinternal financial controls with reference to financial statements were established andmaintained and whether such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to financial statements and their operatingeffectiveness.
Our audit of internal financial controls with reference to financial statementsincluded obtaining an understanding of such internal financial controls assessing therisk that a material weakness exists
and testing and evaluating the design and operating effectiveness of internal controlbased on the assessed risk. The procedures selected depend on the auditor's judgementincluding the assessment of the risks of material misstatement of the standalone financialstatements whether due to 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 Company's internal financial controls withreference to financial statements.
Meaning of Internal Financial Controls with reference to Financial Statements
A company's internal financial controls with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles.
A company'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 have amaterial effect on the financial statements.
Inherent Limitations of Internal Financial Controls with reference to financialstatements
Because of the inherent limitations of internal financial controls with reference tofinancial statements including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls withreference to financial statements to future periods are subject to the risk that theinternal financial controls with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.
| ||Chartered Accountants |
| || |
Firm Registration No. 101248 W/W-100022
| ||Venkataramanan Vishwanath |
|Place: Mumbai ||Partner |
| ||Membership No. 113156 |
|Date: 28 May 2020 || |