To the Members of NATCO Pharma Limited
Report on the Audit of the Standalone Financial Statements
We have audited the standalone financial statements of NATCO Pharma Limited ("theCompany") which comprise the standalone balance sheet as at 31 March 2021 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 affairs of the Company as at 31 March 2021 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 with theCode of Ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the standalone financial statementsunder the provisions of the Act and the Rules thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our opinion on the Standalone financial statements.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone financial statements of the current period.These matters 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 these matters.
1) Revenue Recognition Refer to Note 3(d) of the summary of significant accountingpolicies to the standalone financial statements
|The key audit matter ||How the matter was addressed in our audit |
|Revenue is recognised when the control of the products being sold has transferred to the customer. The Company has a large number of customers operating in various geographies and sale contracts with customers have a variety of different terms relating to the recognition of revenue. Control is usually transferred upon shipment/ delivery to/ upon receipt of goods by the customer in accordance with the delivery and acceptance terms agreed with the customers. ||In view of the significance of the matter we applied the following audit procedures in this area among others to obtain sufficient and appropriate audit evidence: |
| ||1) Evaluated the appropriateness of the revenue recognition accounting policies by comparing with applicable accounting standards. |
|We identified the recognition of revenue from sale of products as a key audit matter because the Company and its external stakeholders focus on revenue as a key performance indicator. There could be a risk that revenue is recognised in the incorrect period or before the control has been transferred to the customer. ||2) Tested design implementation and operating effectiveness of the Company's controls over measurement and recognition of revenue in accordance with customer contracts which includes control over transaction pricing including discounts and correct timing of revenue recognition. |
| ||3) Performed substantive testing (including year-end cut-off testing) by selecting samples of revenue transactions recorded during the year (and before and after the financial year end) including one off sales to customers by verifying the underlying documents which included sales invoices contracts and shipping documents as applicable. |
| ||4) We tested manual journals posted to revenue to identify unusual transactions. |
2) Assessment of recoverability of the carrying value of investment in a subsidiary
|The key audit matter ||How the matter was addressed in our audit |
|The Company through its subsidiary Timecap Overseas Limited ("Timecap") has made investments in NATCO farma Do Brasil Ltda. ('NATCO Brazil') which is engaged in marketing of pharmaceutical products in Brazil. The Company holds 100% stake in NATCO Brazil as at 31 March 2021. ||In view of the significance of the matter we applied the following audit procedures in this area among others to obtain sufficient and appropriate audit evidence: |
|The Company through Timecap has invested Rs 1262 million in NATCO Brazil. NATCO Brazil has reported loss of Rs 62 million for the year ended 31 March 2021 and as at that date its accumulated losses aggregating Rs 1170 million have significantly eroded its equity. Refer note 7 to standalone financial statements. ||1) Tested operating effectiveness of Company's controls over appropriateness of the impairment analysis. Evaluated the accuracy of prior period cash flow forecasts of the Company by reference to actual performance. |
|We identified assessing potential impairment of investment in the subsidiary as a key audit matter because of the significance of carrying value of investment in NATCO Brazil through Timecap to the financial statements and because of the degree of judgement exercised by Company in determining whether there was objective evidence of impairment of investment. ||2) Using our knowledge of the Company and industry challenged significant assumptions and judgements incorporated in valuation report of the subsidiary by an independent valuer specifically in relation to forecast revenue margins terminal growth and discount rates with the assistance of our valuations specialists. Valuation specialists also compared significant assumptions to externally derived data in relation to key inputs such as projected economic growth cost inflation and discount rates. |
| ||3) Performed sensitivity analysis of the key assumptions such as revenue growth rates gross margins and the discount rate applied by the Company in determining value in use and considered the resulting impact on the impairment testing and whether there were any indicators of management bias in the selection of these key assumptions. |
| ||4) Evaluated the adequacy of disclosures including disclosures of key assumptions judgements and sensitivities. |
3) Deferred tax asset
|The key audit matter ||How the matter was addressed in our audit |
|The Company operates in a complex tax jurisdiction in India with various tax exemptions available. The Company has paid minimum alternate tax (MAT) under Section 115JB of the Income-tax Act 1961. The MAT paid would be available as offset over a period of 15 years. The MAT credit is recognised as a deferred tax asset that will be available for offset when the Company pays regular taxes under the provisions of Income-tax Act 1961. ||In view of the significance of the matter we applied the following audit procedures in this area among others to obtain sufficient appropriate audit evidence: |
| ||1) Tested the operating effectiveness of the Company's control over recognition of deferred tax asset. |
|Refer note 29(E) to the standalone financial statements for unrecognised deferred tax asset amounting to Rs 808 million as at 31 March 2021. ||2) We analysed origination of MAT credit entitlement and assessed the reasonableness of Company's assessment and conclusion in relation to its utilisation within the period allowed for carry forward and set off against foreseeable forecast taxable income streams. |
|In assessing whether the deferred tax assets will be realised the Company considers whether some portion or all of the deferred tax assets will not be realised. The ultimate realisation of the deferred tax assets is dependent upon the generation of future taxable income during the periods in which the temporary differences become deductible. ||3) We evaluated appropriateness of taxation disclosures in note 29 to the standalone financial statements including the enhanced disclosures made in respect of the utilisation period of deferred tax assets in relation to MAT credit entitlement. |
|The extent of recognition of deferred tax asset on account of MAT credit requires significant judgment regarding the Company's future taxable income which will result in utilisation of the MAT credit within the time limits available under the applicable Income tax laws. || |
The Company's Management and Board of Directors are responsible for the otherinformation. The other information comprises the information included in the Company'sannual report but does not include the standalone financial statements and our auditors'report thereon. The Company's annual report is expected to be made available to us afterthe date of this auditor's report.
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 identified above when it becomes available and in doingso consider whether the other information is materially inconsistent with the standalonefinancial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated.
When we read the Annual report if we conclude that there is a material misstatementtherein we are required to communicate the matter to those charged with governance andtake actions as per applicable laws and regulations.
Management's and Board of Directors' Responsibility for the Standalone FinancialStatements
The Company's Management and Board of Directors are responsible for the matters statedin Section 134(5) of the Act with respect to the preparation of these standalone financialstatements that give a true and fair view of the state of affairs profit/loss and othercomprehensive income changes in equity and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under Section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe 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 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 Directorsare responsible for assessing the Company's ability to continue as a going concerndisclosing
as applicable matters related to going concern and using the going concern basis ofaccounting unless the Board of Directors either intends to liquidate the Company or tocease 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 judgment andmaintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.
Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under Section 143(3)(i)of the Act we are also responsible for expressing our opinion on whether the company hasadequate internal financial controls with reference to financial statements in place andthe operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures in the standalone financial statementsmade by the Management and Board of Directors.
Conclude 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 a material uncertainty existsrelated to events or conditions that may cast significant doubt on the Company's abilityto continue as a going concern. If we conclude that a material uncertainty exists we arerequired to draw attention in our auditor's report to the related disclosures in thestandalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.
Evaluate the overall presentation structure and content of the standalonefinancial statements including the disclosures and whether the standalone financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.
From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditors' 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. As required by the Companies (Auditors' 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 report that:
a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.
b) I n 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 and loss (includingother comprehensive income) the standalone statement of changes in equity and thestandalone statement of cash flows dealt with by this Report are in agreement with thebooks of account.
d) I n our opinion the aforesaid standalone financial statements comply with the IndAS specified under section 133 of the Act.
e) On the basis of the written representations received from the directors as on 31March 2021 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2021 from being appointed as a director in terms of Section164(2) of the Act.
f) With 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 Auditors' 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 31 March 2021 onits financial position in its standalone financial statements - Refer Note 37(b) (i) &(ii) to the standalone financial statements.
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. There 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 dealingsin specified banknotes duringtheperiodfrom8November2016to30December2016 havenot been made inthesefinancialstatementssincetheydo not pertain to the financial yearended 31 March 2021.
(C) With respect to the matter to be included in the Auditors' 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 accordance with theprovisions of Section 197 of the Act. The remuneration paid to any director is not inexcess of the limit laid down under Section 197 of the Act. The Ministry of CorporateAffairs has not prescribed other details under Section 197(16) which are required to becommented upon by us.
for B S R & Associates LLP
ICAI Firm Registration No.: 116231W/ W-100024
Membership No.: 061272
Date: 17 June 2021
Annexure A to the Independent Auditors' Report on the standalone financial statementsof NATCO Pharma Limited for the year ended 31 March 2021
With reference to the Annexure A referred to in Paragraph 1 in Report on Other Legaland Regulatory Requirements of the Independent Auditors' Report of even date to theMembers of NATCO Pharma Limited ("the Company") on the standalone financialstatements for the year ended 31 March 2021 we report that:
i. a) The Company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets.
b) The Company has a regular programme of physical verification of its fixed assets bywhich all fixed assets are verified in a phased manner over a period of three years. Inour opinion the periodicity of physical verification is reasonable having regard to thesize of the Company and the nature of its assets. Pursuant to the programme certain fixedassets were physically verified during the year and no material discrepancies were noticedon such verification.
c) According to the information and explanations given by the Management the titledeeds of immovable properties included in fixed assets are held in the name of the Companyexcept as for the following:
|Nature of property ||Total number of cases ||Whether leasehold Gross block or freehold ||Net block ||Remarks |
|Land ||One ||Freehold Rs 66 million ||Rs 66 million ||According to the information and explanation given to us this land parcel shall be registered in the name of the Company subsequent to fulfilment of certain conditions laid out by the Andhra Pradesh Industrial Infrastructure Corporation Limited. Also refer Note 5 to the standalone financial statements. |
ii. The inventory except goods-in-transit and stocks lying with third parties havebeen physically verified by the Management during the year. In our opinion the frequencyof such verification is reasonable. The discrepancies noticed on verification between thephysical stock and the book records were not material and have been appropriately dealtwith in the books of account. For stocks lying with third parties at the year-end writtenconfirmations have been obtained by the Management.
iii. According to the information and explanations given to us the Company has grantedunsecured loans to one company (foreign subsidiary) and two other parties (directors)covered in the Register maintained under Section 189 of the Companies Act 2013 ("theAct"). The Company has not granted any other loans secured or unsecured to firmslimited liability partnerships or other parties covered in the Register maintained underSection 189 of the Act.
a) In our opinion and according to the information and explanations given to us theterms and conditions on which the loans had been granted to the company
and other parties listed in the Register maintained under Section 189 of the Act werenot prima facie prejudicial to the interest of the Company.
b) In the case of the loans granted to the company and other parties listed in theRegister maintained under Section 189 of the Act the borrowers have been regular in therepayment of the principal and payment of interest wherever stipulated.
c) There are no overdue amounts in respect of loans granted to the company and otherparties listed in the Register maintained under Section 189 of the Act.
iv. I n our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Act with respectto the loans given investments made and guarantees given. Further the Company has notprovided any security to the parties covered under Section 185 and 186 of the Act.
v. The Company has not accepted any deposits from the public within the meaning of thedirectives issued by the Reserve Bank of India provisions of Section 73 to 76 of the Actany other relevant provisions of the Act and the relevant rules framed thereunder.Accordingly the provisions of clause 3(v) of the said Order is not applicable to theCompany.
vi. We have broadly reviewed the books of account maintained by the Company pursuant tothe rules prescribed by the Central Government for maintenance of cost records underSection 148 of the Act and are of the opinion that prima facie the prescribed accountsand records have been made and maintained. However we have not made a detailedexamination of the records with a view to determine whether they are accurate or complete.
vii. (a) According to the information and explanations given
to us and on the basis of our examination of the records of the Company amountsdeducted/ accrued in the books of account in respect of undisputed statutory duesincluding Provident Fund Employees' State Insurance Income-tax Duty of Customs Goodsand Service Tax and other material statutory dues have been regularly deposited during theyear by the Company with the appropriate authorities. As explained to us the Company didnot have any dues on account of Sales tax Service tax Duty of excise Value added taxand Cess.
According to the information and explanations given to us no undisputed amountspayable in respect of Provident Fund Employees' State Insurance Income- tax Duty ofCustoms Goods and Service Tax and other material statutory dues were in arrears as at 31March 2021 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us there are no dues inrespect of Income-tax or Sales tax or Service tax or Duty of Customs or Duty of Excise orGoods and Service Tax or Value Added Tax which have not been deposited by the Company onaccount of disputes except for the following:
|Statute/Nature of dues ||Amount in Rupees millions ||Period to which the amount relates ||Forum where dispute is pending |
|Central Sales Tax Act 1956 - Central Sales Tax ||10 (3)* ||Financial year 1997-98 2014-15 201516 and 2017-18 ||The High Court of Telangana |
|The Customs Act 1962 - Customs duty ||2 ||July 2006 to June 2010 ||The Customs Excise and Service Tax Appellate Tribunal |
*Represent amounts paid under protest.
viii. I n our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of loans or borrowings to banks. The Companydid not have any outstanding loans or borrowings from financial institutions or governmentand there are no dues to debenture holders during the year.
ix I n our opinion and according to the information and
explanations given to us the Company did not raise any money by way of initial publicoffer or further public offer (including debt instrument) and terms loans during the year.Accordingly the provisions of clause 3(ix) of the said Order is not applicable to theCompany.
x. During the course of our examination of the books and records of the Companycarried out in accordance with the 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
employees noticed or reported during the year nor have we been informed of any suchcase by the Management.
xi. According to the information and explanations given 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 ofSection 197 read with Schedule V to the Act.
xii. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company is not a Nidhi Company prescribedunder Section 406 of the Act. Accordingly the provisions of clause 3(xii) of the saidOrder 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 all transactions with the related parties arein compliance with Sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the standalone financial statements as required bythe applicable accounting standards.
xiv. According to the information and explanations given 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 the provisions of clause 3(xiv) of the said Order is not applicableto 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 any non-cashtransactions with directors or persons connected with them as referred to in Section 192of the Act. Accordingly the provisions of clause 3(xv) of the said Order is notapplicable to the Company.
xvi. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company is not required to be registeredunder Section 45-IA of the Reserve Bank of India Act 1934. Accordingly the provisions ofclause 3(xvi) of the said Order is not applicable to the Company.
for B S R & Associates LLP
ICAI Firm Registration No.: 116231W/ W-100024
Membership No.: 061272
Date: 17 June 2021
Annexure B to the Independent Auditors' Report on the standalone financial statementsof NATCO Pharma Limited for the year ended 31 March 2021
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 (2A(f)) under 'Report on Other Legal and RegulatoryRequirements' section of our report of even date)
We have audited the internal financial controls with reference to financial statementsof NATCO Pharma Limited ("the Company") as of 31 March 2021 in conjunction withour audit 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 31 March 2021 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 Noterequire that 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 whether such controls operatedeffectively 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 financialstatements included obtaining an understanding of such internal financial controlsassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgement including the assessment of the risks ofmaterial misstatement of the standalone financial statements whether due to fraud orerror.
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 controlswith reference to financial statements include those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.
Inherent Limitations of Internal Financial controls 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.
for B S R & Associates LLP
ICAI Firm Registration No.: 116231W/ W-100024
Membership No.: 061272 UDIN: 21061272AAAABJ1484
Place: Hyderabad Date: 17 June 2021