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Repco Home Finance Ltd.

BSE: 535322 Sector: Financials
NSE: REPCOHOME ISIN Code: INE612J01015
BSE 00:00 | 29 Jul 347.65 2.90
(0.84%)
OPEN

350.00

HIGH

352.65

LOW

346.00

NSE 00:00 | 29 Jul 347.40 3.00
(0.87%)
OPEN

347.70

HIGH

352.80

LOW

346.00

OPEN 350.00
PREVIOUS CLOSE 344.75
VOLUME 6575
52-Week high 429.25
52-Week low 130.30
P/E 7.56
Mkt Cap.(Rs cr) 2,175
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 350.00
CLOSE 344.75
VOLUME 6575
52-Week high 429.25
52-Week low 130.30
P/E 7.56
Mkt Cap.(Rs cr) 2,175
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Repco Home Finance Ltd. (REPCOHOME) - Auditors Report

Company auditors report

TO THE MEMBERS OF REPCO HOME FINANCE LIMITED

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of Repco Home FinanceLimited ("the Company") which comprise the Balance sheet as at March 31 2020the Statement of Profit and Loss including the statement of Other Comprehensive Incomethe Cash Flow Statement and the Statement of Changes in Equity for the year then endedand notes to the standalone financial statements including a summary of significantaccounting 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 as amended ("the Act") in the manner so required andgive a true and fair view in conformity with the accounting principles generally acceptedin India of the state of affairs of the Company as at March 31 2020 its profitincluding other comprehensive income its cash flows and the changes in equity for the yearended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with theStandards 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 Standalone Financial Statements' section of ourreport. We are independent of the Company in accordance with the ‘Code of Ethics'issued by the Institute of Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our audit opinion on the standalone financial statements.

Emphasis of Matter

We draw attention to Note no 3 to the accompanying standalone financial statementswhich describes the economic and social disruption the Company is facing as a result ofCOVID-19 pandemic and its possible consequential implications on the Company'soperations and financial metrics. Our opinion is not modified in respect of this abovematter.

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 for the financial yearended March 31 2020. These matters were addressed in the context of our audit of thestandalone financial statements as a whole and in forming our opinion thereon and we donot provide a separate opinion on these matters. For each matter below our description ofhow our audit addressed the matter is provided in that context. We have determined thematters described below to be the key audit matters to be communicated in our report. Wehave fulfilled the responsibilities described in the Auditor's responsibilities for theaudit of the standalone financial statements section of our report including inrelationtothesematters.Accordinglyourauditincluded the performance of procedures designedto respond to our assessment of the risks of material misstatement of the standalonefinancial statements. The results of our audit procedures including the proceduresperformed to address the matters below provide the basis for our audit opinion on theaccompanying standalone financial statements.

Key audit matters How our audit addressed the key audit matter
(a) Impairment of Financial Instruments based on expected credit loss models (Refer to note 5.3 and note
8.1 to the financial statements)
Financial instruments which include advances to customers represents a significant portion of the total assets of the Company. The Company has advances aggregating Rs 11801.65 crores as at March 31 2020. Our audit procedures included the following:
As per the expected credit loss model prescribed under Ind AS 109 the Company is required to estimate the probability of loss / expected loss based on past experience and future considerations. This involves a significant degree of estimation and judgements including determination of staging of financial instruments; estimation of probability of defaults loss given defaults exposure at defaults; and forward looking factors micro- and macro-economic factors in estimating the expected credit losses. Additionally the economic and business consequences of the COVID-19 pandemic as described in Note 8 to the financial statements significant social disruption and disturbance and slowdown of economic activity moratoriums granted to borrowers the related regulatory directives and also the applicable accounting directions further affect loan loss provisioning under the ECL approach. We read and assessed the Company 's impairment provisioning policy with reference to Ind AS 109 and the provisioning framework approved by the Board of Directors as well as relevant regulatory guidelines and pronouncements.
For expected credit loss provision against outstanding exposures classified across various stages we obtained an understanding of the Company's provisioning methodology (including factors that affect the probability of default loss given defaults and exposure at default; various forward looking micro- and macro-economic factors) the underlying assumptions and the sufficiency of the data used by management and tested the same on sample basis.
Due to the significance of the amounts involved judgments involved in classification of loans relative complexity of various assumptions and estimates used and determination of related provisions this audit area is considered a key audit matter. We performed tests of controls and details on a sample tests basis in respect of the staging of outstanding exposures implementation of CompanypolicyinresponsetoCOVID-19andother relevant data used in impairment computations prepared by management as compared to the Company's policy.
We enquired with the management regarding significant judgments and estimates involved in the impairment computation and additional provision arising from the effects of the COVID-19 pandemic and evaluated the reasonableness thereof.
We tested the arithmetical accuracy of computation of ECL provision performed by the Company in spreadsheets
Assessed disclosures included in the standalone financial statements in respect of expected credit losses including the specific disclosures made with regard to the impact of COVID-19 on ECL estimation.

Other Information

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Annual Report but does not includethe standalone financial statements and our auditor's report thereon. The Annual report isexpected to be made available to us after the 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 ouraudit of the standalone financial statements our responsibility is to read the otherinformation and in doing so consider whether such other information is materiallyinconsistent with the financial statements or our knowledge obtained in the audit orotherwise appears to be materially misstated. If based on the work we have performed weconclude that there is a material misstatement of this other information we are requiredto report that fact. We have nothing to report in this regard.

Responsibilities of Board of Directors for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these standalone financial statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income cash flows and changes in equity 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 read with theCompanies (Indian Accounting Standards) Rules 2015 as amended. 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 the designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

Those Board of Directors are 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 standalone financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theAct 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 reasonableness ofaccounting estimates and related disclosures made by management.

Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

Evaluate the overall presentation structure and content of the standalone financialstatements including the disclosures and whether the standalone financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation. We communicate with those charged with governance regarding among othermatters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

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 statementsfor the financial year ended March 31 2020 and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Act we give in the "Annexure 1" a statement on the matters specified inparagraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act we report that: (a) We have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purposes of our audit; (b) In our opinion proper books ofaccounts as required by law have been kept by the Company so far as it appears from ourexamination of those books; (c) The Balance Sheet the Statement of Profit and Lossincluding the Statement of Other Comprehensive Income the Cash Flow Statement andStatement of Changes in Equity dealt with by this Report are in agreement with the booksof account; (d) In our opinion the aforesaid standalone financial statements comply withthe Accounting

Standards specified under Section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended; (e) On the basis of the writtenrepresentations received from the directors as on March 31 2020 taken on record by theBoard of Directors none of the directors are disqualified as on March 31 2020 from beingappointed as a director in terms of Section 164 (2) of the Act; (f) With respect to theadequacy of the internal financial controls over financial reporting of the Company withreference to these standalone financial statements and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure 2" to this report; (g) Inour opinion the managerial remuneration for the year ended March 31 2020 has been paid /provided by the Company to its 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 inthe Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 as amended in our opinion and to the best of our information and according tothe explanations given to us: i. The Company has disclosed the impact of pendinglitigations on its financial position in its standalone financial statements – ReferNote 34 to the standalone financial statements; ii. The Company has made provision asrequired under the applicable law or accounting standards for material foreseeablelosses if any on long-term contracts including derivative contracts – Refer Note8.1 to the standalone financial statements. iii. There were no amounts which were requiredto be transferred to the Investor Education and Protection Fund by the Company.

For S.R. BATLIBOI & ASSOCIATES LLP
Chartered Accountants
ICAI Firm Registration Number: 101049W/E300004
per Aniruddh Sankaran
Partner
Membership Number: 211107
UDIN: 20211107AAAACR2483
Place of Signature: Chennai
Date: July 23 2020

ANNEXURE 1 TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE FINANCIAL STATEMENTSOF REPCO HOME FINANCE LIMITED (THE "COMPANY")

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) Fixed assets have been physically verified by the management during the year and nomaterial discrepancies were identified on such verification.

(c) According to the information and explanations given by the management the titledeeds of immovable properties included in property plant and equipment/ fixed assets areheld in the name of the company.

(ii) The Company's business does not involve inventories and accordingly therequirements under paragraph 3(ii) of the Order are not applicable to the Company.

(iii) (a) According to the information and explanations given to us the Company hasnot granted 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. Accordingly the provisions of clause 3(iii)(a) (b) and (c) of theOrder are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to usprovisions of section 185 and 186 of the Companies Act 2013 in respect of loans todirectors including entities in which they are interested and in respect of loans andadvances given investments made and guarantees and securities given have been compliedwith by the company. (v) The Company has not accepted any deposits within the meaning ofSections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules 2014 (asamended). Accordingly the provisions of clause 3(v) of the Order are not applicable.

(vi) To the best of our knowledge and as explained the Central Government has notspecified the maintenance of cost records under Section 148(1) of the Companies Act 2013for the products of the Company.

(vii) (a) The Company is regular in depositing with appropriate authorities undisputedstatutory dues including provident fund income-tax sales-tax service tax goods andservice tax cess and other statutory dues applicable to it. The provisions relating toduty of custom value added tax and duty of excise are not applicable to the Company (b)According to the information and explanations given to us no undisputed amounts payablein respect of provident fund income-tax sales-tax service tax value added tax cessand other material statutory dues were outstanding at the year end for a period of morethan six months from the date they became payable. (c) According to the information andexplanations given to us there are no dues of sales-tax service tax value added tax andcess which have not been deposited on account of any dispute. The dues outstanding ofincome tax on account of a dispute is as follows

Name of the Statute Nature of dues Period of dispute Amount due Rs. In crores * Forum where it is pending
Income Tax Act 1961 Income Tax FY 2012-13 5.31 Income Tax appellate Tribunal (ITAT)
Income Tax Act 1961 Income Tax FY 2013-14 4.33 Commissioner of Income tax appeals

* The Company has paid an aggregate of Rs.1.06 crores in protest against these mattersand has filled appeal in both the cases.

(viii) In our opinion and according to the information and explanations given by themanagement the Company has not defaulted in repayment of loans or borrowing to afinancial institution bank or government or dues to debenture holders. (ix) According tothe information and explanations given by the management the Company has not raised anymoney way of initial public offer / further public offer / debt instruments and term loanshence reporting under clause (ix) is not applicable to the Company and hence notcommented upon. (x) Based upon the audit procedures performed for the purpose of reportingthe true and fair view of the financial statements and according to the information andexplanations given by the management we report that no fraud by the company or no fraud /material fraud on the company by the officers and employees of the Company has beennoticed or reported during the year.

(xi) According to the information and explanations given by the management themanagerial remuneration has been paid / provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) In our opinion the Company is not a nidhi company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and on an overallexamination of the balance sheet the Company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder review and hence reporting requirements under clause 3(xiv) are not applicable tothe Company and not commented upon. (xv) According to the information and explanationsgiven by the management the Company has not entered into any non-cash transactions withdirectors or persons connected with him as referred to in section 192 of Companies Act2013.

(xvi) According to the information and explanations given to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.

For S.R. Batliboi & Associates LLP
Chartered Accountants
ICAI Firm Registration Number: 101049W/E300004
per Aniruddh Sankaran
Partner
Membership Number: 211107
UDIN: . 20211107AAAACR2483
Place of Signature: Chennai
Date: July 23 2020

ANNEXURE 2 TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONE FINANCIALSTATEMENTS OF REPCO HOME FINANCE LIMTED

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

We have audited the internal financial controls over financial reporting of Repco HomeFinance 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.

Management's Responsibility for Internal Financial Controls

The Company's Management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to the Company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting with reference to these standalone financial statementsbased on our audit. We conducted our audit in accordance with the Guidance Note on Auditof Internal Financial Controls Over Financial Reporting (the "Guidance Note")and the Standards on Auditing as specified under section 143(10) of the Companies Act2013 to the extent applicable to an audit of internal financial controls and both issuedby the Institute of

Chartered Accountants of India. Those Standards and the Guidance Note require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting withreference to these standalone financial statements was established and maintained and ifsuch controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls over financial reporting with reference to thesestandalone 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 standalonefinancial 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 is sufficient andappropriate to provide a basis for our audit opinion on the internal financial controlsover financial reporting with reference to these standalone financial statements.

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

A company's internal financial control over financial reporting with reference to thesestandalone financial statements is a process designed to provide reasonableassuranceregardingthereliabilityoffinancialreporting 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 standalone 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 Standalone Financial Statements

Because of the inherent limitations of internal financial controls over financialreporting with reference to these standalone 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 standalone financial statements to future periods are subject to the risk thatthe internal financial control over financial reporting with reference to these standalonefinancial statements may become inadequate because of changes in conditions or that thedegree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects adequate internal financialcontrols over financial reporting with reference to these standalone financial statementsand such internal financial controls over financial reporting with reference to thesestandalone financial statements were operating effectively as at March 31 2020 based onthe internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.

For S.R. Batliboi & Associates LLP
Chartered Accountants
ICAI Firm Registration Number: 101049W/E300004
per Aniruddh Sankaran
Partner
Membership Number: 211107
UDIN: 20211107AAAACR2483
Place of Signature: Chennai
Date: July 23 2020

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