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Schneider Electric Infrastructure Ltd.

BSE: 534139 Sector: Engineering
NSE: SCHNEIDER ISIN Code: INE839M01018
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VOLUME 20337
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VOLUME 20337
52-Week high 134.80
52-Week low 81.30
P/E
Mkt Cap.(Rs cr) 2,145
Buy Price 88.20
Buy Qty 10.00
Sell Price 89.10
Sell Qty 24.00

Schneider Electric Infrastructure Ltd. (SCHNEIDER) - Auditors Report

Company auditors report

To

The Members of

Schneider Electric Infrastructure Limited

Report on the Ind AS Financial Statements

We have audited the accompanying Ind AS financial statements of SchneiderElectricInfrastructure Limited ("the Company") which comprise the Balance Sheet as atMarch 31 2018 the Statement of Profit and Loss including the statement of OtherComprehensive Income the Cash Flow Statement and the Statement of Changes in Eguityfortheyear then ended and a summary of significant accounting policiesand otherexplanatoryinformation.

Management's Responsibility forthe Ind AS Financial 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 Ind AS financial statements that give a true and fair view of the financialposition financial performance including other comprehensive income cash flows andchanges in eguity of the Company in accordance with accounting principles generallyaccepted in India including the Indian Accounting Standards (Ind AS) specified undersection 133 of the Act. read with the Companies (Indian Accounting Standards) Rules2015 as amended. This responsibility also includes maintenance of adeguate accountingrecords in accordance with the provisions of the Act for safeguarding of the assets of theCompany and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and the design implementation and maintenance of adeguateinternal financial control that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS financial statements that give a true and fair view and are free from materialmisstatement whetherdue to fraud orerror

Auditor's Responsibility

Our responsibility is to express an opinion on these Ind AS financial statements basedon our audit. We have taken into account the provisions of the Act the accounting andauditing standards and matters which are reguired to be included in the audit report underthe provisions of the Act and the Rules made thereunder We conducted our audit of the IndAS financial statements in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India as specified under Section 143(10) of theAct. Those Standards reguire that we comply with ethical reguirements and plan and performthe audit to obtain reasonable assurance about whether the financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the Ind ASfinancial statements whether due to fraud orerror In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of theInd AS financial statements that give a true and fair view in order to design auditprocedures that are appropriate in the circumstances. An audit also includes evaluatingthe appropriateness of accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof the Ind AS financial statements. We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our audit opinion on the Ind ASfinancial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the Ind AS financial statements give the information reguired by the Act inthe manner so reguired and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2018 its loss including other comprehensive income its cash flows and the changes ineguityforthe year ended on that date.

Report on Other Legal and Regulatory Reguirements

1. As reguired 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 in paragraphs 3and 4 of the Order

2. 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 forthe purpose of our audit;

(b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books;

(c) The Balance Sheet Statement of Profit and Loss including the Statement of OtherComprehensive Income the Cash Flow Statement and Statement of Changes in Equity dealtwith by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid Ind AS financial statements comply with theAccounting Standards specified under section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended;

(e) On the basis of written representations received from the directors as on March312018 and taken on record by the Board of Directors none of the directors isdisqualified as on March 312018 from being appointed as a director in terms of section164 (2) of the Act;

(f) With respectto the adequacy of the internal financial controls overfinancialreporting of the Company with reference to these Ind AS financial statements and theoperating effectiveness of such controls refer to our separate Report in ‘Annexure2" to this report;

(g) With respectto 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 Ind AS financial statements - Refer Note 33 to the Ind AS financialstatements;

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts - Refer Note 15 to the Ind AS financial statements;

iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company

For S.R. Batliboi & CO. LLP

Chartered Accountants ICAI

Firm Registration Number: 301003E/E300005

Per Vishal Sharma
Place: Gurugram Partner
Date: May 19 2018 Membership Number: 096766

Annexure 1 referred to in paragraph 1 under the heading "Report on other legal andregulatory requirements" of our report of even date

Re: Schneider Electric Infrastructure Limited ("the Company")

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

(b) All fixed assets have not been physically verified by the management during theyear but there is a regular programme of verification which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. No materialdiscrepancies were noticed 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 are held in thename of the Company.

(ii) The inventory has been physically verified by the management during the year. Inour opinion the frequency of verification is reasonable. No material discrepancies werenoticed on such physical verification. Inventories lying with third parties have beenconfirmed by them and no material discrepancieswere noticed in respect of suchconfirmations.

(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms limited liabilitypartnerships or other parties covered in the register maintained under section 189 of theCompanies Act 2013. 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 usthere are no loans investments guarantees and securities granted in respect of whichprovisions of section 185 and 186 of the Companies Act 2013 are applicable and hence notcommented upon.

(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76of the Act and the Companies (Acceptance of Deposits) Rules 2014 (as amended).Accordingly the provisions of clause 3(v) of the Orderare notapplicable.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Companies Act 2013 related to the manufacture of powertransformers switchgears and other related products and are of the opinion that primafacie the specified accounts and records have been made and maintained. We have nothowever made a detailed examination of the same.

(vii) (a) Undisputed statutory dues including provident fund employees' stateinsurance income-tax sales-tax service tax duty of custom duty of excise value addedtax goods and service taxcess and other material statutory dues have generally beenregularly deposited with the appropriate authorities though there has been a slight delayin a few cases.

(b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income-tax service taxsales-tax duty of custom duty of excise value added tax goods and service 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 records of the Company the dues outstanding of sales-tax servicetax duty of custom duty of excise value added tax income tax and cess on account ofany dispute are as follows:

Name of Statute Nature of Dues Amount

(Rupees

Millions)

Amount

Deposited

(Rupees

Millions)

Period to which the amount relates Forum where dispute is pending
1 Central Excise Act 1944 Demand of duty for Exemption under notification 108/95 10.29 - 2001-02 Tribunal

Delhi

2 Central Excise Act 1944 Under valuation of VIT tubes 5.21 2.00 1994-95 CESTAT - Chennai
3 Central Excise Act 1944 Non-inclusion of 15% Profit Margin in Transfer Pricing 5.13 - 1993-94 and 1994-95 Kolkata High Court
4 Central Excise Act 1944 Rejection of refund claim towards CENVAT reversals as insisted during Excise audit 4.44* " 2012-13 CESTAT – Chennai
5 Central Excise Act 1944 Wrongly availment and distribution of ISD Credit 15.07 - 2011-13 CESTAT - Ahmedabad
6 Central Excise Act 1944 Refund of excise duty denied for cases where proof of Export submitted after payment of Excise Duty after 180 days of export 3.07 - 2012-13 Tribunal Gujarat
7 Central Excise Act 1944 Captively consumed goods cleared by availing exemption under notification 6/2006 0.11* ' 2008-09 & 2010-11 CESTAT - Chennai
8 Central Excise Act 1944 Disallowance of CENVAT Credit duty on captive consumption and clearance of goods under Notification 6 of 2006. 0.60* 2009-10 CESTAT - Chennai
9 Central Excise Act 1944 Short payment of Duty 1.35 - 2007-08 Commissioner (Appeals) LTU
10 Central Excise Act 1944 Demand of duty for Exemption u/n 108/95 0.47* - 2003-04 Commissioner (Adj.) New Delhi
11 Central Excise Act 1944 CENVAT Credit availed on SAP maintenance charges 0.21* - 2008-09 High Court - Chennai
12 Central Excise Act 1944 Levy of penalty 0.02 - 2011-12 CESTAT - Chennai
13 Central Excise Act 1944 Seizure of spares while being transported to Railway Station alleging transportation without Invoice. 0.01 1996-97 Commissioner (Appeals) Allahabad
14 Finance Act 1994 Service Tax on testing and technical Analysis Service 0.45 - Dec-11 to Sep-12 Commissioner Appeals
15 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 139.84* 26.28 2010-11 & 2011-12 Joint Commissioner (Corporate Circle)
16 Central Sales Tax Act 1956 Non submission of declaration Forms Input tax claim disallowed 168.38 - 2007-08 Revision Board at Beliaghata
17 Central Sales Tax Act 1956 Non submission of Form C/l/E-1 and export documents 56.64* 44.30 2009-10 Joint Commissioner (Allahabad)
18 Central Sales Tax Act 1956 Non collection of declaration forms 22.52* 37.97 2007-08 Joint Commissioner Allahabad
19 Central Sales Tax Act 1956 Non collection of declaration forms & CST treated as local VAT Sale 27.99* 14.59 2010-11 Additional Commissioner Appeals
20 Central Sales Tax Act 1956 Non submission of form C/l/E-1 and export documents 50.28* 48.56 2008-09 Joint Commissioner (Allahabad)
21 Central Sales Tax Act 1956 Non Submission of C Forms 44.87* 9.47 2009-10 Tribunal Ahemdabad
22 Central Sales Tax Act 1956 Non submission of declaration forms 14.96* 20.65 2010-11 & 2011-12 Tribunal
23 Central Sales Tax Act 1956 Non collection of declaration forms 28.05* 21.19 2006-07 Deputy Commissioner Allahabad
24 Central Sales Tax Act 1956 Non collection of declaration forms 1.57* 0.76 1993-94 1997-1998

2003- 04

2004- 05 & 2005-06

Assessing Officer Charge Office West Bengal
25 Central Sales Tax Act 1956 Non submission of declaration forms 11.9* 14.87 2008-09 & 2009-10 Deputy Commissioner Allahabad
26 Central Sales Tax Act 1956 Non collection of declaration forms 17.21* " 2005- 06

2006- 07 & 2007-08

Deputy Commissioner U.P Sales Tax
27 Central Sales Tax Act 1956 Input tax claim disallowed non-submission of declaration forms 9.30* 2009-10 West Bengal Commercial Taxes Appellate & Revisional Board
28 Gujarat Value Added Tax 2003 Non collection of declaration form 16.56* 3.35 2007-08 & 2008-09 Joint Commissioner (Corporate)
29 Central Sales Tax Act 1956 Non collection of declaration forms 6.36* - 2002-03 Calcutta High Court
30 Uttar Pradesh Trade Tax Act 1948 Ex Parte Assessment Order Passed. Records not submitted at the Time of Assessment. 5.50* 4.61 2005-06 Deputy Commissioner U.P Sales Tax
31 Central Sales Tax Act 1956 Non collection of declaration forms 3.91* 2001-02 2002-03 & 2011-12 Deputy Commissioner
32 Central Sales Tax Act 1956 Disallowance of stock transfers made within the state Denial of input tax credit Difference in interpretation of rates and Non submission of documents to substantiate the purchases 3.58* 3.58 2008-09 Joint Commissioner (Allahabad)
33 West Bengal Sales Tax Act 1994 Non collection of declaration forms 3.20 - 1997-98 West Bengal Tribunal
34 Delhi Value Added Tax Act 2004 Non submission of Statutory Form such as C/H/F/E-1 and export documents 1.83 2007-08 Commercial Tax Officer
35 Central Sales Tax Act 1956 Non submission of declaration forms Input tax claim disallowed 1* 0.40 2006-07 Assessing Officer Charge Office West Bengal
36 Central Sales Tax Act 1956 Non collection of declaration form CST .Documents like PO Endorsed ARE 1 E1 Forms 0.54* " 2009-10 Deputy Commissioner Comm Tax
37 Uttar Pradesh Trade Tax Act 1948 Levy of purchase Tax due to Unregistered purchases made 0.33* " 2006-07 Deputy Commissioner Sales Tax Noida
38 Tamil Nadu General Sales Tax Act 1959 Levy of penalty for wrong disclosure of turnover and Non furnishing of required documents for export & other claims 0.29* " 1991-92 Sales Tax Appellate Tribunal Chennai
39 Central Sales Tax Act 1956 Non collection of declaration forms 0.26* " 2008-09 Deputy Commissioner Jaipur
40 Madhya Pradesh Value Added Tax Act 2002 Non collection of declaration form CST treated as local VAT Sale 0.18* 0.06 2010-11 Deputy Commissioner Appeal
41 Rajasthan Value Added Tax Act 2003 Input tax claim disallowed 0.08* " 2008-09 Deputy Commissioner Jaipur
42 Madhya Pradesh Value Added Tax Act 2002 Entry Tax On High Sea Sales Imported Material 0.07* 0.02 2010-11 Deputy Commissioner Appeals
43 Central Sales Tax Act 1956 Provisional Assessment 4.54 0.91 2014-15 Additional Commissioner Appeals
44 Gujarat Value Added Tax 2003 Input tax claim disallowed non-submission of declaration forms 146.50* 28.27 2011-12 Joint Commissioner Appeals
45 Central Sales Tax Act 1956 Non collection of declaration forms 17.35 8.41 2011-12

2013-14

Deputy/Additional Commissioner Appeal
46 Central Sales Tax Act 1956 Non collection of declaration forms 1.94 8.79 2013-14 Deputy Commissioner
47 Central Sales Tax Act 1956 Non collection of declaration forms 16.87 2.53 2012-13 Joint Commissioner Appeals
48 Central Sales Tax Act 1956 Non collection of declaration forms 7.67* 3.56 2008-09

2011-12

Deputy Commissioner Appeals
49 Central Sales Tax Act 1956 Non collection of declaration forms 11.09* 2009-10 Deputy Commissioner Appeal
50 Central Sales Tax Act 1956 Non collection of declaration forms 12.10* 2.42 2011-12 Joint Commissioner Appeals
51 Central Sales Tax Act 1956 Non collection of declaration forms 1.77* ' 2009-10 Deputy Commissioner Appeals
52 Central Sales Tax Act 1956 Non collection of declaration forms 0.42* 0.14 2010-11 Deputy Commissioner Appeals
53 Central Sales Tax Act 1956 Non collection of declaration forms 6.82* 1.82 2010-11 Deputy Commissioner Appeals
54 Central Sales Tax Act 1956 Non collection of declaration forms 2.80 - 1997-98 Tribunal
55 Central Sales Tax Act 1956 Non collection of declaration forms 16.79 - 1993-94 Revision Board at Beliaghata
56 Finance Act 1994 Non-payment of service tax on provision created in books /short payment of service tax on royalty and technical knowhow payments made under intellectual property right services. 10.12* 2010-11 CESTAT - Chennai
57 Finance Act 1994 Irregular availment of CENVAT Credit of Service Tax 4.98* - 2012-13 CESTAT - Chennai
58 Finance Act 1994 Disallowance of CENVAT credit availed on certain input services 0.79* - 2012-13 CESTAT - Chennai
59 Finance Act 1994 Non-payment of service tax on provision created in books /short payment of service tax on royalty and technical knowhow payments made under intellectual property right services 0.65* 2011-12 CESTAT - Chennai
60 Finance Act 1994 Non-payment of Service Tax on Manpower supply services 0.62* - 2012-13 CESTAT - Chennai
61 Finance Act 1994 Rejection of refund claim of interest paid for CENVAT credit wrongly availed but not utilised 0.13* 2012-13 CESTAT - Chennai
62 Finance Act 1994 Short payment of service tax on GTA 0.08* - 2009-10 High Court- Chennai
63 The Custom Act 1962 Refund of drawback for non-realisation of export proceeds 5.59 " 2012-13 Commissioner of Customs (Appeals)
64 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 4.40 2012-13 Deputy Commissioner Noida-I Uttar Pradesh
65 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 47.36 5.72 2012-2013 Joint commissioner of Commercial Tax (Appeals) Vadodara
66 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 28.57 5.71 2011-12 Deputy Commissioner Vadodara
67 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 20.52 2.07 2013-14 Deputy Commissioner Appeal
68 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 3.70 9.75 2014-15 Appellate Deputy Commissioner Of Commercial Taxes Chennai (South)
69 Central Sales Tax Act 1956 Non-submission of waybill Form 402 6.41 2.10 2016-2017 Deputy Commissioner Commercial Taxes Gujarat
70 Central Sales Tax Act 1956 ITC disallowance 4.72 2012-2013 Joint commissioner of Commercial Tax (Appeals) Vadodara
71 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 3.77 2013-14 Assistant Commissioner of Commercial Tax Rajasthan
72 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 0.75 1.81 2012-13 Appellate Deputy Commissioner Of Commercial Taxes Chennai (South]
73 Central Sales Tax Act 1956 Non submission of Statutory Form such as C 0.36 2014-15 Assistant Commissioner of Commercial Tax Rajasthan
74 Central Sales Tax Act 1956 Regular VAT assessment 0.24 2013-14 Assistant Commissioner of Commercial Tax Rajasthan
75 Central Excise Act 1944 Irregular availment of Cenvat Credit on certain Ineligible service alleged 0.46* - 2010-2011 CESTAT - CHENNAI
76 Central Excise Act 1944 Excise duty on Exports 2.51 0.19 2012-2013 Commissioner Appeal
77 Central Excise Act 1944 Duty on removal of Inputs "as such" 2.37 2011-2016 Additional Commissioner Sec-62 Noida
78 Central Excise Act 1944 Excise duty on Freight charges recovered from customer to be included in Assessable value 11.65 0.87 2011-2016 Additional Commissioner Vadodara-ll
79 Income Tax Act1961 Disallowance on account of bad debts written off and various other disallowances 90.00 27.20 AY 2012-13 Commissioner of Income Tax (Appeals)
80 Income Tax Act1961 Disallowance on account of bad debts written off and various other disallowances 104.31 33.75 AY 2013-14 Commissioner of Income Tax (Appeals)
81 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 32.89 3.29 2013-2014 Additional Commissioner (Appeals) Noida
82 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 200.86 7.65 2014-2015 Joint Commissioner Sales Tax West Bengal
83 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 65.23 7.29 2013-2014 Deputy Commissioner Commercial Taxes Gujarat
84 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 20.90 " 2014-2015 Joint Commissioner Sales Tax Noida
85 Central Sales Tax Act 1956 Non submission of Statutory Form such as C/H/F/E-1 and export documents 8.50 2014-2015 Joint Commissioner Sales Tax Delhi
86 Central Excise Act 1944 Denial of excise exemption on account of mismatch of signature on exemption certificate 0.90 0.07 2013-2014 CGST& CEAC WB
87 Finance Act 1994 Non-Payment of Service Tax on Research & Development and Rule 2(l) Of CCR 2004 3.86 0.29 2012-2013 Commissioner (Appeals) Fucknow
88 Central Excise Act 1944 Service tax on royalty made at the time of payment and not at the time of provisioning 0.31 - 2011-2012 Joint Commissioner West Bengal

* Represents Company's share of Rs.673.83 Million of dues pending in forums Jointlywith ALSTOM T&D India Limited

(Refer Note 33 of the accompanying Ind AS financial statements)

(viii) In our opinion and according to the information and explanations given by themanagement the Company has not defaulted in repayment of dues to any bank. Further thecompany did not have any outstanding debentures and did not have any outstanding loans orborrowings dues in respect of a financial institution orto Government.

(ix) According to the information and explanations given by the management the Companyhas not raised any money way of initial public offer/further public offer / debtinstruments and term loans hence reporting under clause (ix) is not applicable to theCompany and hence not commented upon.

(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the Company or no fraud on the Companyby the officers and employees of the Company has been noticed 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 reguisiteapprovals 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 reguired 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 audit and hence reporting reguirements under clause 3(xiv) are not applicable tothe company and not commented upon.

(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in section 192 of Companies Act 2013.

(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 & CO. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
per Vishal Sharma
Place: Gurugram Partner
Date: May 19 2018 Membership Number: 096766

Annexure 2 to the Independent Auditor's Report of Even Date On The Standalone Ind ASFinancial Statements of Schneider Electric Infrastructure Limited ("theCompany")

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 overfinancial reporting of SchneiderElectric Infrastructure Limited ("the Company") as of March 312018 inconjunction with our audit of the Ind AS financial statements of the Company for the yearended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control overfinancial 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 adeguate 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 asreguired under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols overfinancial reporting with reference to these Ind AS financial statements basedon our audit. We conducted our audit in accordance with the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting (the "Guidance Note") andthe Standards on Auditing as specified under section 143(10) of the Companies Act 2013to the extent applicable to an audit of internal financial controls and both issued bythe Institute of Chartered Accountants of India. Those Standards and the Guidance Notereguire that we comply with ethical reguirements and plan and perform the audit to obtainreasonable assurance about whether adeguate internal financial controls overfinancialreporting with reference to these Ind AS financial statements was established andmaintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adeguacy ofthe internal financial controls system over financial reporting with reference to theseInd AS financial statements and their operating effectiveness. Our audit of internalfinancial controls overfinancial reporting included obtaining an understanding of internalfinancial controls overfinancial reporting with reference to these Ind AS financialstatements assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgement including the assessment of therisks of material misstatement of the financial statements whether due to fraud orerror

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our gualified audit opinion on the internal financial controlsoverfinancial reporting with reference to these Ind AS financial statements.

Meaning of Internal Financial Controls Over Financial Reporting with reference to theseInd AS Financial Statements

A company's internal financial control overfinancial reporting with reference to theseInd AS 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 Ind AS 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 acguisition 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 Ind AS Financial Statements

Because of the inherent limitations of internal financial controls overfinancialreporting with reference to these Ind AS financial statements including the possibilityof collusion or improper management override of controls material misstatements due toerror orfraud may occur and not be detected. Also projections of any evaluation of theinternal financial controls overfinancial reporting with reference to these Ind ASfinancial statements to future periods are subject to the risk that the internal financialcontrol over financial reporting with reference to these Ind AS financial statements maybecome inadeguate because of changes in conditions or that the degree of compliance withthe policies or procedures may deteriorate.

Qualified Opinion

According to the information and explanations given to us and based on our audit thefollowing material weakness has been identified in the operating effectiveness of theCompany's internal financial controls overfinancial reporting with reference to these IndAS financial statements as at March 312018:

The Company's internal control system for procurement to paymentfunction wasnotoperating effectively since there were material weaknesses in approval of purchaseorders. This could potentially result in material misstatement in Trade Payables.

A 'material weakness' is a deficiency ora combination of deficiencies in internalfinancial control overfinancial reporting such that there is a reasonable possibilitythat a material misstatement of the company's annual or interim financial statements willnot be prevented or detected on a timely basis.

In our opinion the Company has in all material respects maintained adeguate internalfinancial controls overfinancial reporting with reference to these Ind AS financialstatements as of March 312018 based on the internal control overfinancial reportingcriteria 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 and except for thepossible effects of the material weakness described above on the achievement of theobjectives of the control criteria the Company's internal financial controlsoverfinancial reporting with reference to these Ind AS financial statements were operatingeffectively as of March312018.

Explanatory paragraph

We also have audited in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India as specified under Section 143(10) of theAct the Ind AS financial statements of Schneider Electric Infrastructure Limited whichcomprise the Balance Sheet as at March 31 2018 the Statement of Profit and Lossincluding the statement of Other Comprehensive Income the Cash Flow Statement and theStatement of Changes in Eguityforthe year then ended and a summary of significantaccounting policies and other explanatory information. This material weakness wasconsidered in determining the nature timing and extent of audit tests applied in ouraudit of the March 312018 Ind AS financial statements of Schneider ElectricInfrastructure Limited and this report does not affect our report dated May 19 2018which expressed an ungualified opinion on those Ind AS financial statements.

For S.R. Batliboi & CO. LLP

Chartered Accountants ICAI

Firm Registration Number: 301003E/E300005

Per Vishal Sharma
Place: Gurugram Partner
Date: May 19 2018 Membership Number: 096766