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Rites Ltd.

BSE: 541556 Sector: Engineering
NSE: RITES ISIN Code: INE320J01015
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OPEN 249.90
PREVIOUS CLOSE 245.00
VOLUME 4523
52-Week high 331.00
52-Week low 191.00
P/E 10.88
Mkt Cap.(Rs cr) 6,134
Buy Price 245.40
Buy Qty 20.00
Sell Price 245.70
Sell Qty 129.00
OPEN 249.90
CLOSE 245.00
VOLUME 4523
52-Week high 331.00
52-Week low 191.00
P/E 10.88
Mkt Cap.(Rs cr) 6,134
Buy Price 245.40
Buy Qty 20.00
Sell Price 245.70
Sell Qty 129.00

Rites Ltd. (RITES) - Auditors Report

Company auditors report

To the Members of RITES Limited

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the accompanying Standalone Financial Statements of RITES Limited("the Company") which comprise the Balance Sheet as at March 31 2020 theStatement of Profit and Loss including Other Comprehensive Income the Statement ofChanges in Equity and the Statement of Cash Flows for the year then ended notes to theStandalone Financial Statements including a summary of the significant accounting policiesand other explanatory information (hereinafter referred to as "the StandaloneFinancial Statements") in which are included the returns for the year ended on thatdate audited by the branch auditors of the company's branches located at Eastern Westernand Southern Region. In our opinion and to the best of our information and according tothe explanations given to us the aforesaid Standalone Financial Statements give theinformation required by the Companies Act 2013 ("the Act") in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the statement of affairs of the Company as at March 312020 the profit including other comprehensive income statement of changes in equity andits cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the Standalone Financial Statements in accordance with theStandards on Auditing (SAs) specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the

Auditor's Responsibilities for the Audit of the Financial Statements section of ourreport. We are independent of the Company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India (ICAI) together with the ethicalrequirements that are relevant to our audit of the Standalone Financial Statements underthe provisions of the Act and the Rules thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the Standalone Financial Statements.

Emphasis of Matter

We draw attention to note no. 2.48.3.4 to the Standalone Financial Statements whichdescribes that the Company has evaluated possible impact that may result from COVID 19pandemic on the carrying value of its assets and liabilities as at March 31 2020. Basedon the underlying data and current estimates the Company does not expect any materialimpact on the carrying amount of these assets and liabilities. Our opinion is not modifiedin respect of above matter.

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. We have determined the matters described below to bethe key audit matters to be communicated in our report.

Sr. No. Key Audit Matter Auditor's Response
1 Accuracy of recognition measurement presentation and disclosures of revenues and other related balances in respect of Ind AS 115 "Revenue from Contracts with Customers" (revenue accounting standard). Our audit approach consisted testing of the design and operating effectiveness of the internal controls and substantive testing as follows:

The application of the revenue accounting standard involves certain key judgements relating to identification of distinct performance obligations determination of transaction price of the identified performance obligations the appropriateness of the basis used to measure revenue recognized at a point in time or over time. Additionally revenue accounting standard contains disclosures which involves collation of information in respect of disaggregated revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date.

• Evaluated the design of internal controls relating to implementation of the revenue accounting standard.
• Selected a sample of contracts and tested the operating effectiveness of the internal control relating to identification of the distinct performance obligations and determination of transaction price.
We carried out a combination of procedures involving enquiry and observation and inspection of evidence in respect of operation of these controls.
• Selected a sample of contracts and performed the following procedures:
– Read analysed and identified the distinct performance obligations in these contracts.
Refer Notes 1.2.1 and 2.40 to the Standalone Financial Statements. – Compared these performance obligations with that identified and recorded by the Company.
– Considered the terms of the contracts to determine the transaction price including any variable consideration to verify the transaction price used to compute revenue and to test the basis of estimation of the variable consideration.
– Performed analytical procedures for reasonableness of revenues disclosed by type and service offerings.
2 Evaluation of uncertain tax positions

Principal Audit Procedures

The Company has disputed tax positions which involves significant judgment to determine the possible outcome of these disputes. Refer Note 2.46.2.1.II to the Standalone Financial Statements. Obtained details of completed tax assessments and demands from management and management's underlying assumptions in estimating the tax provision and the possible outcome of the disputes. We also considered legal precedence and other rulings in evaluating management's position on these uncertain tax positions.

Information Other than the Standalone Financial Statements and Auditor's Report thereon

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 our audit report.

Our opinion on the Standalone Financial Statements does not cover the other informationand we will not express any form of assurance conclusion thereon. In connection with ouraudit of the Standalone Financial Statements our responsibility is to read the otherinformation identified above when it becomes available and in doing so consider whetherthe other information is materially inconsistent with the financial statements or ourknowledge obtained in the audit or otherwise appears to be materially 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.

Responsibilities of Management and those charged with Governance for the StandaloneFinancial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese Standalone Financial Statements that give a true and fair view of the financialposition financial performance including other comprehensive income changes in Equityand cash flows of the Company in accordance with the accounting principles generallyaccepted in India including the accounting Standards specified under section 133 of theAct. This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Standalone Financial Statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error. In preparing the StandaloneFinancial Statements the Board of Directors is responsible for assessing the Company'sability to continue as a going concern disclosing as applicable matters related togoing concern and using the going concern basis of accounting unless the Board ofDirectors 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 judgement 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 risk 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 controls 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 Standalone Financial Statements inplace and the operating effectiveness 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 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 Standalone 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 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 havecomplied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may reasonably be thought to bear onour independence and where applicable related safeguards. From the matters communicatedwith those charged with governance we determine those matters that were of mostsignificance in the audit of the Standalone Financial Statements of the current period andare therefore the key audit matters. We describe these matters in our auditor's reportunless law or regulation precludes public disclosure about the matter or when inextremely rare circumstances we determine that a matter should not be communicated in ourreport because the adverse consequences of doing so would reasonably be expected tooutweigh the public interest benefits of such communication.

Other Matters

(a) We did not audit the financial statements of three branches included in theStandalone Financial Statements of the Company whose financial statements reflect totalassets of Rs.1440.49 crores at March 31 2020 and the total revenue of Rs.738.07crores and profit before tax of Rs.262.78 crores for the year ended on that dateas considered in the Standalone Financial Statements. The financial statements of thesebranches have been audited by the branch auditors whose reports have been furnished to usand our opinion in so far as it relates to the amounts and disclosures included in respectof branches is based solely on the report of such branch auditors.

(b) The Standalone Financial Statements include company's shares of total assets of Rs.4.34crores as at March 31 2020 and company's share of total revenue of Rs.1.20 croresand share of net profit after tax including other comprehensive income of Rs.0.01crores for the year ended March 31 2020 in respect of five joint operations whosefinancial statements have not been audited by us. The financial statements of these jointoperations have been audited by the joint operations' auditors whose reports have beenfurnished to us and our opinion in so far as it relates to the amounts and disclosuresincluded in respect of joint operations is based solely on the report of such jointoperations' auditors.

Our opinion is not modified in respect of above matters.

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 Companies Act 2013 we give in the "Annexure I" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

2. In terms of sub section (5) of section 143 of the Act we give in the "AnnexureII" a statement on the directions issued under the aforesaid section by theComptroller and Auditor General of India.

3. 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) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books and proper returnsadequate for the purposes of our audit have been received from the branches not visited byus;

(c) The reports on the accounts of the branch offices of the Company audited underSection 143(8) of the Act by branch auditors have been sent to us and have been properlydealt with by us in preparing this report;

(d) The Balance Sheet the Statement of Profit and Loss including other comprehensiveincome statement of changes in Equity and the Cash Flow Statement dealt with by thisreport are in agreement with the books of account and with the returns received from thebranches not visited by us;

(e) In our opinion the aforesaid Standalone Financial Statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014;

(f) In view of exemption given vide notification no. G.S.R. 463(E) dated 5th June2015 issued by Ministry of Corporate Affairs provisions of Section 164(2) of the Actregarding disqualifications of Directors are not applicable to the Company;

(g) With respect to the adequacy of the internal financial controls with reference tothe Standalone Financial Statements of the Company and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure III";

(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 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 on its financialposition in its Standalone Financial Statements – Refer Note 2.46.2.1 to theStandalone Financial Statements;

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses; iii. There were no amounts which wererequired to be transferred to the Investor Education and Protection Fund by the Company.

4. In our opinion and to the best of our information and according to the explanationsgiven to us provisions of Section 197 of the Act are not applicable to the company withrespect to the managerial remuneration paid/provided during the year ended March 31 2020.

ANNEXURE I TO THE INDEPENDENT AUDITOR'S REPORT REFERRED TO IN PARAGRAPH 1 UNDER THEHEADING "REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS" OF OUR REPORT OFEVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF RITES LIMITED.

1. (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of all Fixed Assets.

(b) The Company has a program of verification to cover all the items of fixed assets ina phased manner which in our opinion is reasonable having regard to the size of theCompany and the nature of its assets. Pursuant to the program fixed assets werephysically verified by the management during the year. According to the information andexplanations given to us no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds/ lease deeds of immovableproperties are held in the name of the Company except 4 leasehold building where leasedeeds are pending for execution (Refer Note no. 2.62 and Note no. 2.62.1 of the standalonefinancial statements) and one number freehold land the title deed of which is yet to beexecuted in the name of the company (Refer Note no. 2.63 of the standalone financialstatements). Details of such properties are as under:

Lying under the head Right of Use asset (Refer Note No. 2.3 of the standalone financialstatements)

S. No. Particulars Gross Block as on 31.03.2020 (Rs. in crores) Net Block as on 31.03.2020 (Rs. in crores)
1. Office Building at Central Metro Railway Building 56 C.R. Avenue Kolkata (Leasehold) 1.32 1.21
2. Physical Testing Laboratory at 52 A&B C.R. Avenue Kolkata 0.46 0.41
3. Office Building at DLF Cyber city Bhubaneshwar 5.43 5.33
4. Wazirpur Northern Railway Colony Delhi 1.93 1.60

Lying under the head Property Plant and Equipment (Refer Note No. 2.1 of thestandalone financial statements)

S. No. Particulars Gross Block as on 31.03.2020 (Rs. in crores) Net Block as on 31.03.2020 (Rs. in crores)
1. Plot of land at Gomti Nagar Extension Lucknow 4.22 4.22

2. As per the information and explanations given to us physical verification ofInventory has been carried out by the management subsequent to the year end as the samecould not be conducted at the year end as per extant policy of the Company due to lockdownrestrictions imposed by the Government of India and no material discrepancies were noticedon physical verification.

3. According to the information and explanations given to us the Company has notgranted loans secured or unsecured during the year to any Companies firms limitedliability partnership or other parties covered in the Register maintained under Section189 of the Companies Act 2013.

4. In 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 Companies Act2013 in respect of grant of loans making investments and providing guarantees andsecurities as applicable.

5. As per the information and explanations given to us the Company has not acceptedany deposits from the public within the meaning of Section 73 to Section 76 or any otherrelevant provisions of the Companies Act 2013 and the rules framed there under during theyear. Accordingly clause (v) of paragraph 3 of the Companies (Auditor's Report) Order2016 is not applicable to the Company.

6. According to the information and explanations given to us the Central Governmenthas not prescribed the maintenance of cost records under section 148(1) of the CompaniesAct 2013 in respect of products sold and services rendered by the Company.

7. (a) According to the information and explanations given to us and on the basis ofour verification of records of the Company the Company is generally regular in depositingwith appropriate authorities undisputed statutory dues including Provident FundEmployees' State Insurance Income Tax Sales Tax Service Tax Duty of Customs Duty ofExcise Value Added Tax Cess Goods and Services Tax and other statutory dues applicableto it. According to the information and explanations given to us no undisputed amountspayable in respect of aforesaid dues were in arrears as at March 31 2020 for a period ofmore than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of theCompany examined by us the particulars of dues of Income Tax Sales Tax Service TaxDuty of Customs Duty of Excise Value Added Tax Goods and Services Tax which have notbeen deposited on account of any dispute are as under:

Name of the statute Nature of due Amount Involved (Rs. in crore) Amount paid under protest (Rs. in crore) Period Forum where dispute is pending
Income Tax Act 1961 Income Tax 2.21 0.56 A.Y. 2009-10 Income Tax Appellate Tribunal
Income Tax Act 1961 Income Tax 2.31 2.31 A.Y. 2012-13 Income Tax Appellate Tribunal
Income Tax Act 1961 Income Tax 2.71 0.25 A.Y. 2013-14 Income Tax Appellate Tribunal
Income Tax Act 1961 Income Tax 6.30 Nil A.Y. 2014-15 Income Tax Appellate Tribunal
Income Tax Act 1961 Income Tax 1.87 Nil A.Y. 2015-16 Income Tax Appellate Tribunal
Income Tax Act 1961 Income Tax 2.18 2.18 A.Y. 2016-17 Commissioner of Income Tax (Appeal)
Income Tax Act 1961 Income Tax 3.03 3.03 A.Y. 2017-18 Commissioner of Income Tax (Appeal)
APVAT Arrears of sales Tax 0.71 0.71 01.04.2014 To 30.11.2015 Appellate Deputy Commissioner of APVAT
West Bengal VAT Value Added Tax 1.32 0.20 01.04.2015 To 31.03.2016 President WBST Appellate- Revisional Board
West Bengal VAT Value Added Tax 0.42 0.06 01.04.2016 To 31.03.2017 Commissioner of Commercial Tax
Finance Act 1994 Service Tax Penalty 0.41 0.41 0.04 01.09.2012 To 31.12.2016 Customs Excise and service Tax Appellate Tribunal
Finance Act 1994 Service Tax Penalty 1.68 1.69 0.15 01.07.2012 To 31.03.2016 Commissioner of Goods and Service Tax (Appeal)

8. According to the information and explanations given to us the Company has not takenany loans or borrowing from financial institution bank government and has not issued anydebentures. Accordingly clause (viii) of paragraph 3 of the Companies (Auditor's Report)Order 2016 is not applicable to the Company.

9. In our opinion and according to the information and explanation given by themanagement the Company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loan during the year. Accordinglyclause (ix) of paragraph 3 of the Companies (Auditor's Report) Order 2016 is notapplicable to the Company.

10. During the course of our examination of the books of accounts and records carriedout in accordance with the generally accepted auditing practices and according to theinformation and explanations given to us no fraud by the Company or on the Company by itsofficers or employees has been noticed or reported during the year.

11. In view of exemption given vide notification no. G. S. R. 463(E) dated June 52015 issued by Ministry of Corporate Affairs provisions of Section 197 read withSchedule V of the Act regarding managerial remuneration are not applicable to the Company.Accordingly clause (xi) of paragraph 3 of the Companies (Auditors Report) Order 2016 isnot applicable to the Company.

12. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly clause (xii) of paragraph 3 of the Companies(Auditors Report) Order 2016 is not applicable to the Company.

13. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Companies Act 2013 where applicable anddetails of such transactions have been disclosed in the standalone financial statements asrequired by the applicable accounting standards.

14. According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. Accordingly clause (xiv) of paragraph 3 of the Companies (Auditors Report)Order 2016 is not applicable to the Company.

15. 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 any of the directors or persons connected with him. Accordingly clause(xv) of paragraph 3 of the Companies (Auditors Report) Order 2016 is not applicable tothe Company.

16. According to the information and explanations given to us the Company is notrequired to be registered under section 45-IA of the Reserve Bank of India Act 1934.Accordingly Clause (xvi) of paragraph 3 of the Companies (Auditor's Report) Order 2016 isnot applicable to the Company.

ANNEXURE II TO THE INDEPENDENT AUDITOR'S REPORT REFERRED TO IN PARAGRAPH 2 UNDER THEHEADING "REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS" OF OUR REPORT OFEVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF RITES LIMITED

Report under Section 143 (5) of the Companies Act 2013 in respect of RITES LIMITED onStandalone Financial Statements for the year ended March 31 2020.

S. No. Directions Auditor's Comments
1. Whether the company has system in place to process all the accounting transactions through IT system? If yes the implications of processing of accounting transactions outside IT system on the integrity of the accounts along with the financial implications if any may be stated. Yes the Company has SAP system in place to process all the accounting transactions. As per information and explanations given to us and during the course of our audit we have not come across the any accounting transactions which were outside the IT system and have financial implications.
2. Whether there is any restructuring of an existing loan or cases of waiver/write off of debs/loans/ interest etc. made by a lender to the company due to company's inability to repay the loan? If yes the financial impact may be stated. According to the information and explanations given to us the Company has not taken any loan. Hence there are no cases of waiver/write off of debts/ loans/interest etc.
3. Whether funds received/receivable for specific schemes from Central/ State agencies were properly accounted for/utilized as per its term and conditions? List the cases of deviation. As per the information and explanations given to us the Company has not received any funds from Central/ State agencies for specific schemes during the year.

ANNEXURE III TO THE INDEPENDENT AUDITOR'S REPORT REFERRED TO IN PARAGRAPH 3(G) UNDERTHE HEADING "REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS" OF OUR REPORT OFEVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF RITES LIMITED

Report on the Internal Financial Controls under Clause

(i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("the Act")Opinion

We have audited the internal financial controls with reference to the StandaloneFinancial Statements of RITES Limited ("the Company") as of March 31 2020 inconjunction with our audit of the standalone financial statements of the Company for theyear ended on that date. In our opinion the Company has in all material respects anadequate internal financial controls with reference to the Standalone Financial Statementsand such internal financial controls were operating effectively as at March 31 2020based on the internal control with reference to the Standalone Financial Statementscriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountants of India.

Management's Responsibility for Internal Financial Controls

The Company's Board of Directors is responsible for establishing and maintaininginternal financial controls based on the internal control with reference to the StandaloneFinancial Statements criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls over Financial Reporting (the "Guidance Note") issued by The Instituteof Chartered Accountants of India ("ICAI"). These responsibilities include thedesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to Company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to the Standalone Financial Statements based on our audit. Weconducted our audit in accordance with the Guidance Note and the Standards on Auditingprescribed under section 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls with reference to the Standalone FinancialStatements both applicable to an audit of Internal Financial Controls and both issued byICAI. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls with reference to the Standalone Financial Statementswere established and maintained and if such controls operated effectively in all materialrespects. Our audit involves performing procedures to obtain audit evidence about theadequacy of the internal financial controls with reference to the Standalone FinancialStatements and their operating effectiveness. Our audit of internal financial controlswith reference to the Standalone Financial Statements included obtaining an understandingof such internal financial controls assessing the risk that a material weakness existsand testing and evaluating the design and operating effectiveness of internal controlbased on the assessed risk. The procedures selected depend on the auditor's judgmentincluding the assessment of the risks of material misstatement of the Standalone FinancialStatements whether due to fraud or error. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion on theCompany's internal financial controls with reference to the Standalone FinancialStatements.

Meaning of Internal Financial Controls with reference to the Standalone FinancialStatements

A company's internal financial control with reference to the Standalone FinancialStatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposesin accordance with generally accepted accounting principles. A company's internalfinancial control with reference to the Standalone Financial Statements includes thosepolicies and procedures that

(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of Standalone financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorizations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial effect on the Standalone financial statements.

Inherent Limitations of Internal Financial Controls with reference to the StandaloneFinancial Statements

Because of the inherent limitations of internal financial controls with reference tothe Standalone Financial Statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to the Standalone Financial Statements to future periods aresubject to the risk that the internal financial control with reference to the StandaloneFinancial Statements may become inadequate because of changes in conditions or that thedegree of compliance with the policies or procedures may deteriorate.

(Anshuman Mallick)
Partner
Place: Gurugram Membership No. 547705
Date : 30th June 2020 UDIN: 20547705AAAAAH4777