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Puravankara Ltd.

BSE: 532891 Sector: Infrastructure
NSE: PURVA ISIN Code: INE323I01011
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VOLUME 3613
52-Week high 87.00
52-Week low 50.80
P/E 22.17
Mkt Cap.(Rs cr) 1,346
Buy Price 56.40
Buy Qty 157.00
Sell Price 56.70
Sell Qty 28.00
OPEN 55.75
CLOSE 56.65
VOLUME 3613
52-Week high 87.00
52-Week low 50.80
P/E 22.17
Mkt Cap.(Rs cr) 1,346
Buy Price 56.40
Buy Qty 157.00
Sell Price 56.70
Sell Qty 28.00

Puravankara Ltd. (PURVA) - Auditors Report

Company auditors report

To the Members of Puravankara Limited

Report on the Audit of the Consolidated Ind AS Financial Statements

Opinion

We have audited the accompanying consolidated Ind AS financial statements ofPuravankara Limited (hereinafter referred to as "the Holding Company") itssubsidiaries associates and joint ventures collectively referred to as "theGroup" comprising of the consolidated Balance sheet as at March 31 2019 theconsolidated Statement of Profit and Loss including other comprehensive income theconsolidated Cash Flow Statement the consolidated Statement of Changes in Equity for theyear then ended and notes to the consolidated Ind AS financial statements including asummary of significant accounting policies and other explanatory information (hereinafterreferred to as "the consolidated Ind AS financial statements").

In our opinion and to the best of our information and according to the explanationsgiven to us and based on the consideration of reports of other auditors on separatefinancial statements and on the other financial information of the subsidiariesassociates and joint ventures the aforesaid consolidated Ind AS financial statements givethe information required by the Companies Act 2013 ("the Act") in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the consolidated state of affairs of the Group as at March312019 their consolidated profit including other comprehensive income theirconsolidated cash flows and the consolidated statement of changes in equity for the yearended on that date.

Basis for Opinion

We conducted our audit of the consolidated Ind AS financial statements in accordancewith the Standards on Auditing (SAs) as specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the 'Auditor'sResponsibilities for the Audit of the Consolidated Ind AS Financial Statements' section ofour report. We are independent of the Group in accordance with the 'Code of Ethics' issuedby the Institute of Chartered

Accountants of India together with the ethical requirements that are relevant to ouraudit of the financial statements under the provisions of the Act and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion on theconsolidated Ind AS financial statements.

Emphasis of Matter

We draw attention to note 37(c) to the accompanying consolidated Ind AS financialstatements in connection with certain ongoing litigations. Pending resolution of thelitigations no provision has been made towards the vendor's claims and customer'scounter-claims and the underlying customer's receivable is classified as good andrecoverable in the accompanying consolidated Ind AS financial statements. Our opinion isnot qualified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the consolidated Ind AS financial statements for thefinancial year ended March 31 2019. These matters were addressed in the context of ouraudit of the consolidated Ind AS financial statements as a whole and in forming ouropinion thereon and we do not provide a separate opinion on these matters. For eachmatter below our description of how our audit addressed the matter is provided in thatcontext.

We have determined the matters described below to be the key audit matters to becommunicated in our report. We have fulfilled the responsibilities described in theAuditor's responsibilities for the audit of the consolidated Ind AS financial statementssection of our report including in relation to these matters. Accordingly our auditincluded the performance of procedures designed to respond to our assessment of the risksof material misstatement of the consolidated Ind AS financial statements. The results ofour audit procedures including the procedures performed to address the matters belowprovide the basis for our audit opinion on the accompanying consolidated Ind AS financialstatements.

Key audit matters How our audit addressed the key audit matter
Adoption of Ind AS 115 - Revenue from Contract with Customers and Amendments to Ind AS 40 Investment Property (as described in note 39 of the Consolidated Ind AS financial statements)
The Group has adopted Ind AS 115 - Revenue from Contracts with Customers and Amendments to Ind AS 40 - Investment Property consequent to issuance of Ind AS 115 mandatory for reporting periods beginning on or after April 12018. As part of our audit procedures our procedures included the following:
The Group has applied the modified retrospective approach to all contracts as at April 012018 and has given impact of Ind AS 115 and Amendments to Ind AS 40 application by debit to retained earnings as at the said date by Rs603.20 crores (net of tax). - We have read the accounting policy for recognition of revenue and derecognition of investment property and assessed compliance of the policy in terms of principles enunciated under Ind AS 115 and Amendments to Ind AS 40.
- We obtained and tested the computation of the adjustment to retained earnings as at the Ind AS 115 and Amendments to Ind AS 40 transition date on sample basis.
The application of Ind AS 115 and Amendments to Ind AS 40 has impacted the Group's accounting for recognition of revenue from real estate projects (other than revenue contract forming part of joint development arrangements) and gain arising from derecognition of investment property which is now being recognised at a point in time upon the Group satisfying its performance obligation and the customer obtaining control of the underlying asset. - We obtained and understood the revenue recognition process and performed test of controls over revenue recognition including determination of point of transfer of control completion of performance obligation and fair value of estimated construction service under JDA on a sample basis.
For revenue contract forming part of Joint Development Arrangements ('JDA') the revenue from the development and transfer of constructed area/revenue share with a corresponding land/ development rights received by the Group is measured at the fair value of the estimated construction service rendered by the Group to the land owner under JDA. Such revenue is recognised over a period of time in accordance with the requirements of Ind AS 115. - We performed test of details on a sample basis and tested the underlying customer/JDA contracts and sale deed/ handover documents evidencing the transfer of control of the asset to the customer
- We obtained and tested the computation of the fair value of the construction service under JDA on sample basis.
For contracts involving sale of real estate unit the Group receives the consideration in accordance with the terms of the contract in proportion of the percentage of completion of such real estate project and represents payments made by customers to secure performance obligation of the Group under the contract enforceable by customers. The assessment of such consideration received from customers involves significant judgment in determining if the contracts with customers involves any financing element. - We tested the computation for recognition of revenue over a period of time for revenue contracts forming part of JDA and the Group's assessment of stage of completion of projects and project cost estimates on test check basis.
Application of Ind AS 115 including selection of transition method involves significant judgment in determining when 'control' of the goods or services underlying the performance obligation is transferred to the customer and the transition method to be applied. Further for revenue contract forming part of JDA significant estimate is made by the Group in determining the fair value of the underlying revenue. - We assessed the disclosures made by Group in compliance with the requirements of Ind AS 115 and Amendments to Ind AS 40.
As the revenue recognition involves significant estimates and judgement we regard this as a key audit matter
Recording of related party transactions and disclosures (as described in note 40 of the Consolidated Ind AS financial statements)
The Group has undertaken transactions with its related parties in the ordinary course of business at arm's length. These include making new or additional investments in its associates & joint ventures and other related parties and lending and borrowing of loans; and other transactions to or from the related parties. As part of our audit procedures our procedures included the following:
- Obtained and read the Group's policies processes and procedures in respect of identifying related parties obtaining approval recording and disclosure of related party transactions on sample basis.
We identified the accuracy and completeness of the said related party transactions and its disclosure as set out in respective notes to the Consolidated Ind AS financial statements as a key audit matter due to the significance of transactions with related parties and regulatory compliance thereon. - Read minutes of shareholder meetings board meetings and minutes oi meetings of those charged with governance in connection with Group's assessment of related party transactions being in the ordinary course of business at arm's length on sample basis.
- Tested on a sample basis related party transactions with the underlying contracts confirmation letters and other supporting documents.
- Agreed the related party information disclosed in the Consolidated Ind AS financial statements with the underlying supporting documents.
Assessing the carrying value of inventory and advances/deposits paid towards land procurement (as described in notes 7(a) 10(a) and 14 of the Consolidated Ind AS financial statements)
As at March 31 2019 the carrying value of the inventory of real estate projects is Rs 6766.1 0 crores and land advances/deposits of Rs378.61 crores. Our procedures in assessing the carrying value of the inventories/land advances/deposits included the following:
The inventories are carried at the lower of cost and Net Realisable Value (NRV). The determination of the NRV involves estimates based on prevailing market conditions and taking into account the estimated future selling price cost to complete projects and selling costs. - We read and evaluated the accounting policies with respect to inventories/ land advances/deposits
Deposits paid under joint development arrangements in the nature of non-refundable amounts are recognised as land advance under other assets and on the launch of the project the same is transferred as land stock under inventories. Further advances paid by the Group to the seller/ intermediary towards outright purchase of land is recognised as land advance under other assets during the course of transferring the legal title to the Group whereupon it is transferred to land stock under inventories. - We assessed the Group's methodology applied in assessing the carrying value under the relevant accounting standards.
- We obtained and tested the computation involved in assessment of carrying value including the net realisable value/ net recoverable value on test check basis.
The aforesaid deposits and advances are carried at the lower of the amount paid/payable and net recoverable value which is based on the Group's assessment including the expected date of commencement and completion of the project and the estimate of sale prices and construction costs of the project. - We compared the realisable/recoverable amount of the asset to the carrying value in books on test check basis.
- We made inquiries with the Holding Company's management to understanc key assumptions used in determination of the net realisable value/ net recoverable value on test check basis.
We identified the assessment of the carrying value of inventory and land advances/deposits as a key audit matter due to the significance of the balance to the Consolidated Ind AS financial statements as a whole and the involvement of estimates and judgement in the assessment.
Compliance with repayment terms of borrowings (as described in note 21 of the Consolidated Ind AS financial statements)
The Group has significant borrowings as it is the key source of funds taken to finance its various real estate development projects as well as for general corporate purpose. Our procedures in relation to compliance with repayment terms of borrowings include the following:
We consider compliance with repayment terms of borrowings as a key audit matter as this is a key consideration for appropriate classification of loan balances and relevant disclosures thereon in the Consolidated Ind AS financial statements. Further compliance with repayment terms is part of Group's assessment of evaluating its gearing and liquidity profile. - Obtained an understanding of the process and testing the internal controls over timely repayment of borrowings on sample basis.
- We tested the repayments of borrowings for a sample of transactions by reading the underlying contracts for repayments schedules comparing the actual cash flows with the repayment schedules and tracing the amounts pale as per books of account to the bank statements.
- Assessed the maturity profile of the borrowings to evaluate the classification and disclosure of borrowings on test check basis.
- Compared on a sample basis the balances confirmed by the lenders with the balances as per the books of accounts.

Other Information

The Holding Company's Board of Directors is responsible for the other information. Theother information comprises the information included in the Annual report but does notinclude the Consolidated Ind AS financial statements and our auditor's report thereon. Theannual report is expected to be made available to us after the date of this auditor'sreport.

Our opinion on the Consolidated Ind AS financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Consolidated Ind AS financial statements ourresponsibility is to read the other information identified above when it becomes availableand in doing so consider whether such other information is materially inconsistent withthe Consolidated Ind AS financial statements or our knowledge obtained in the audit orotherwise appears to be materially misstated.

Responsibilities of Management and Those Charged with Governance for the ConsolidatedFinancial Statements

The Holding Company's Board of Directors is responsible for the preparation andpresentation of these consolidated Ind AS financial statements in terms of therequirements of the Act that give a true and fair view of the consolidated financialposition consolidated financial performance including other comprehensive incomeconsolidated cash flows and consolidated statement of changes in equity of the Group inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards (Ind AS) specified under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended. The respective Board ofDirectors of the companies and management of associate and joint venture partnership firmsincluded in the Group are responsible for maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Group andfor preventing and detecting frauds and other irregularities; the selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe consolidated Ind AS financial statements that give a true and fair view and are freefrom material misstatement whether due to fraud or error which have been used for thepurpose of preparation of the consolidated Ind AS financial statements by the Directors ofthe Holding Company as aforesaid.

In preparing the consolidated financial statements the respective Board of Directorsof the companies and management of associate and joint venture partnership firms includedin the Group are responsible for assessing the ability of the Group to continue as a goingconcern disclosing as applicable matters related to going concern and using the goingconcern basis of accounting unless management either intends to liquidate the Group or tocease operations or has no realistic alternative but to do so.

Those charged with governance are also responsible for overseeing the financialreporting process of the Group.

Auditor's Responsibilities for the Audit of the Consolidated Ind AS FinancialStatements

Our objectives are to obtain reasonable assurance about whether the consolidated Ind ASfinancial 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 consolidated Ind AS 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 consolidated IndAS financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control.

• Obtain an understanding of internal control relevant to the audit 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 HoldingCompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the ability ofthe Group to continue as a going concern. If we conclude that a material uncertaintyexists we are required to draw attention in our auditor's report to the relateddisclosures in the consolidated Ind AS 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 conditions maycause the Group to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of the consolidated IndAS financialstatements including the disclosures and whether the consolidated Ind ASfinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial informationof the entities or business activities within the Group of which we are the independentauditors to express an opinion on the consolidated Ind AS financial statements. We areresponsible for the direction supervision and performance of the audit of the financialstatements of such entities included in the consolidated financial statements of which weare the independent auditors. For the other entities included in the consolidatedfinancial statements which have been audited by other auditors such other auditorsremain responsible for the direction supervision and performance of the audits carriedout by them. We remain solely responsible for our audit opinion.

We communicate with those charged with governance of the Holding Company and such otherentities included in the consolidated Ind AS financial statements of which we are theindependent auditors regarding among other matters the planned scope and timing of theaudit and significant audit findings including any significant deficiencies in internalcontrol 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 consolidated Ind AS financialstatements for the financial year ended March 31 2019 and are therefore the key auditmatters. We describe these matters in our auditor's report unless law or regulationprecludes public disclosure about the matter or when in extremely rare circumstances wedetermine that a matter should not be communicated in our report because the adverseconsequences of doing so would reasonably be expected to outweigh the public interestbenefits of such communication.

Other Matter

We did not audit the financial statements and other financial information in respectof 24 subsidiaries whose Ind AS financial statements include total assets of Rs1023.95crores as at March 31 2019 and total revenues of Rs 47.17 crores and net cashinflows of Rs6.76 crores for the year ended on that date. These Ind AS financialstatements and other financial information have been audited by other auditors whosefinancial statements other financial information and auditor's reports have beenfurnished to us by the management. The consolidated Ind AS financial statements alsoinclude the Group's share of net loss of Rs 1.72 crores for the year ended March31 2019 as considered in the consolidated Ind AS financial statements in respect of 4associates and 1 joint venture whose financial statements and other financial informationhave been audited by other auditors and whose reports have been furnished to us by themanagement. Our opinion on the consolidated Ind AS financial statements in so far as itrelates to the amounts and disclosures included in respect of these subsidiaries jointventure and associates and our report in terms of sub-sections (3) of Section 143 of theAct in so far as it relates to the aforesaid subsidiaries joint venture and associatesis based solely on the reports of such other auditors. Our opinion above on theconsolidated Ind AS financial statements and our report on Other Legal and RegulatoryRequirements below is not modified in respect of the above matters with respect to ourreliance on the work done and the reports of the other auditors.

Report on Other Legal and Regulatory Requirements

As required by Section 143(3) of the Act based on our audit and on the considerationof report of the other auditors on separate financial statements and the other financialinformation of subsidiaries associates and joint ventures as noted in the 'other matter'paragraph we report to the extent applicable that:

(a) We/the other auditors whose report we have relied upon have sought and obtained allthe information and explanations which to the best of our knowledge and belief werenecessary for the purpose of our audit of the aforesaid consolidated Ind AS financialstatements;

(b) In our opinion proper books of account as required by law relating to preparationof the aforesaid consolidation of the financial statements have been kept so far as itappears from our examination of those books and reports of the other auditors;

(c) The consolidated Balance sheet the consolidated Statement of Profit and Lossincluding the Statement of other comprehensive income the consolidated Cash FlowStatement and consolidated Statement of Changes in Equity dealt with by this Report are inagreement with the books of account maintained for the purpose of preparation of theconsolidated Ind AS financial statements;

(d) In our opinion the aforesaid consolidated Ind AS financial statements comply withthe Accounting Standards specified under Section 133 of the Act read with Companies(Indian Accounting Standards) Rules 2015 as amended;

(e) On the basis of the written representations received from the directors of theHolding Company as on March 31 2019 taken on record by the

Board of Directors of the Holding Company and the reports of the statutory auditors whoare appointed under Section 139 of the Act of its subsidiary companies associatecompanies and joint venture company incorporated in India none of the directors of theGroup's companies incorporated in India is disqualified as on March 31 2019 from beingappointed as a director in terms of Section 164 (2) of the Act;

(f) With respect to the adequacy and the operating effectiveness of the internalfinancial controls over financial reporting with reference to these consolidated Ind ASfinancial statements of the Holding Company and its subsidiary companies associatecompanies and joint venture company incorporated in India refer to our separate report inAnnexure to this report;

(g) In our opinion and based on the consideration of reports of other auditors of thesubsidiaries companies and associate companies incorporated in India the managerialremuneration for the year ended March 31 2019 has been paid / provided by the HoldingCompany its subsidiaries companies associate companies and joint venture companyincorporated in India to their directors in accordance with the provisions of section 197read with Schedule V to the Act;

(h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous and based on the consideration of the report of the other auditors on separatefinancial statements as also the other financial information of the subsidiariesassociates and joint venture as noted in the 'Other matter' paragraph:

i. The consolidated Ind AS financial statements disclose the impact of pendinglitigations on its consolidated financial position of the Group in its consolidated IndAS financial statements - Refer note 37(c) to the consolidated Ind AS financialstatements;

ii. Provision has been made in the consolidated Ind AS financial statements asrequired under the applicable law or accounting standards for material foreseeablelosses if any on long-term contracts including derivative contracts;

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Holding Company its subsidiarycompanies associate companies and joint venture companies incorporated in India.

For S.R. Batliboi & Associates LLP
Chartered Accountants
ICAI Firm Registration Number: 1 01 049W/E300004
per Adarsh Ranka
Place: Bengaluru Partner
Date: May 18 2019 Membership Number: 209567

ANNEXURE TO THE INDEPENDENT AUDITDR'S REPORT OF EVEN DATE DN THE CONSOLIDATED IND ASFINANCIAL STATEMENTS DF PURAVANKARA LIMITED

Report on the Internal Financial Controls under Clause (i) of Subsection 3 of Section143 of the Companies Act 2013 ("the Act")

In conjunction with our audit of the consolidated financialstatements of PuravankaraLimited as of and for the year ended March 31 2019 we have audited the internalfinancial controls over financial reporting of Puravankara Limited (hereinafter referredto as the "Holding Company") and its subsidiary companies associate companiesand joint venture companies which are companies incorporated in India as of that date.

Management's Responsibility for Internal Financial Controls The respective Board ofDirectors of the Holding Company its subsidiary companies its associate companies andjoint venture companies which are companies incorporated in India are responsible forestablishing and maintaining internalfinancial controls based on the internal control overfinancial reporting criteria established by the Holding Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia. These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to the respectivecompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act. Auditor'sResponsibility

Our responsibility is to express an opinion on the company's internal financialcontrols over financial reporting with reference to these consolidated financialstatements based on our audit. We conducted our audit in accordance with the Guidance Noteon Audit of Internal Financial Controls Over Financial Reporting (the "GuidanceNote") and the Standards on Auditing both issued by Institute of CharteredAccountants of India and deemed to be prescribed under section 143(10) of the Act to theextent applicable to an audit of internal financial controls. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting with reference to these consolidated financial statements wasestablished and maintained and if such controls operated effectively in all materialrespects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting with reference to theseconsolidated financial statements and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting with reference to these consolidatedfinancial statements assessing the risk that a material weakness exists and testing andevaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgement including theassessment of the risks of material misstatement of the financial statements whether dueto fraud or error.

We believe that the audit evidence we have obtained and the audit evidence obtained bythe other auditors in terms of their reports referred to in the Other Matters paragraphbelow is sufficient and appropriate to provide a basis for our audit opinion on theinternal financial controls over financial reporting with reference to these consolidatedfinancial statements.

Meaning of Internal Financial Controls Over Financial Reporting With Reference to theseConsolidated Financial Statements

A company's internal financial control over financial reporting with reference to theseconsolidated financial statements is a process designed to provide reasonable assuranceregarding the reliability of financial reporting and the preparation of financialstatements for external purposes in accordance with generally accepted accountingprinciples. A company's internal financial control over financial reporting with referenceto these consolidated financial statements includes those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting WithReference to these Consolidated Financial Statements

Because of the inherent limitations of internal financial controls over financialreporting with reference to these consolidated financial statements including thepossibility of collusion or improper management override of controls materialmisstatements due to error or fraud may occur and not be detected. Also projections ofany evaluation of the internal financial controls over financial reporting with referenceto these consolidated financial statements to future periods are subject to the risk thatthe internal financial control over financial reporting with reference to theseconsolidated financial statements may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Holding Company its subsidiary companies associate companies andjoint venture companies which are companies incorporated in India have maintained in allmaterial respects adequate internal financial controls over financial reporting withreference to these consolidated financial statements and such internal financial controlsover financial reporting with reference to these consolidated financial statements wereoperating effectively as at March 31 2019 based on the internal control over financialreporting criteria established by the Holding Company considering the essential componentsof internal control stated in the Guidance Note on Audit of Internal Financial ControlsOver Financial Reporting issued by the Institute of Chartered Accountants of India.

Other Matters

Our report under Section 143(3)(i) of the Act on the adequacy and operatingeffectiveness of the internal financial controls over financial reporting with referenceto these consolidated financial statements of the Holding Company insofar as it relatesto these 21 subsidiary companies and 3 associate companies which are companiesincorporated in India is based on the corresponding reports of the auditors of suchsubsidiary companies and associate companies incorporated in India.

For S.R. Batliboi & Associates LLP
Chartered Accountants
ICAI Firm Registration Number: 101 049W/E300004
per Adarsh Ranka
Place: Bengaluru Partner
Date: May 18 2019 Membership Number: 209567

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