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Shriram Transport Finance Company Ltd.

BSE: 511218 Sector: Financials
NSE: SRTRANSFIN ISIN Code: INE721A01013
BSE 00:00 | 07 Apr 536.85 15.95
(3.06%)
OPEN

540.00

HIGH

562.50

LOW

500.00

NSE 00:00 | 07 Apr 538.25 17.60
(3.38%)
OPEN

535.60

HIGH

564.40

LOW

500.10

OPEN 540.00
PREVIOUS CLOSE 520.90
VOLUME 376921
52-Week high 1366.90
52-Week low 440.00
P/E 4.03
Mkt Cap.(Rs cr) 12,180
Buy Price 536.85
Buy Qty 4.00
Sell Price 536.85
Sell Qty 196.00
OPEN 540.00
CLOSE 520.90
VOLUME 376921
52-Week high 1366.90
52-Week low 440.00
P/E 4.03
Mkt Cap.(Rs cr) 12,180
Buy Price 536.85
Buy Qty 4.00
Sell Price 536.85
Sell Qty 196.00

Shriram Transport Finance Company Ltd. (SRTRANSFIN) - Auditors Report

Company auditors report

To the Members of

Shriram Transport Finance Company Limited

REPORT ON THE AUDIT OF THE STANDALONE

FINANCIAL Statement

Opinion

We have audited the accompanying Standalone Financial Statements of Shriram TransportFinance Company Limited (“the Company”) which comprise the Balance Sheet as atMarch 31 2019 the Statement of Profit and Loss (including Other Comprehensive Income)the Statement of Changes in Equity and the Statement of Cash Flows for the year then endedand notes to the Standalone Financial Statements including a summary of significantaccounting policies and other explanatory information (hereinafter referred to as“Standalone Financial Statements”).

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 (“the Act”) in the manner so required and give a trueand fair view in conformity with the accounting principles generally accepted in Indiaincluding the Indian Accounting Standards (“Ind AS”) of the state of affairs ofthe Company as at March 31 2019 its total comprehensive income changes in equity andits cash flows for the year ended on that date.

BASIS FOR OPINION

We conducted our audit in accordance with Standards on Auditing (SAs) specified undersection 143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditor's Responsibilities for the Audit of the Standalone FinancialStatements section of our report. We are independent of the Company in accordance with theCode of Ethics issued by the Institute of Chartered Accountants of India(“ICAI”) together with the ethical requirements that are relevant to our auditof the Standalone Financial statements under the provisions of the Act and Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.

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.

1. Transition to Indian Accounting Standards (“Ind AS”)

The Company has adopted Ind AS notified under section 133 of the Companies Act 2013(“the Act”) read with the Companies (Indian Accounting Standards) Rules 2015from April 01 2018 and the effective date of such transition is April 01 2017. Ind ASare new and complex accounting standards which require considerable judgment andinterpretation in its implementation. Further Ind AS 101 (“First-time Adoption ofIndian Accounting Standards”) allows two categories of exceptions to the first-timeadopters which mainly includes prohibition to retrospective application of certainrequirements of Ind AS and exemption from some requirements of Ind AS. We consider thistransition and the required disclosure to be a key audit matter because new accountingpolicies have been developed by the Company to comply with these standards and judgment.Note 6 “Significant Accounting Policies” Note 55 First-time adoption of Ind ASNote 53 “Fair value measurement” and Note 54 “Risk management” to theStandalone Ind AS Financial Statements provide detailed information on the significantpolicies critical judgment and estimation along with details of exemptions applied fromcertain requirements under Ind AS based on which these Standalone Financial Statements areprepared.

Principal Audit Procedures:

We have performed the following audit procedures in order to obtain sufficient auditevidence:

• Assessed the Company's process to identify the impact of adoption and transitionto the new accounting standards.

• Evaluated the design of internal controls and tested the operating effectivenessof key internal controls around the process of preparation of Standalone FinancialStatements;

• Reviewed the exemptions availed by the Company from certain requirements underInd AS;

• Obtained an understanding of the governance over the determination of keyjudgments;

• Evaluated and tested the key assumptions and judgments adopted by management;

• Assessed the disclosures made against the relevant Ind AS; and

• Determined the appropriateness of the methodologies and models used along withthe responsibility of the outputs.

2. Impairment loss allowance of loans and advances

Impairment loss allowance of loans and advances (“Impairment loss allowance”)is a Key Audit Matter as the Company has significant credit risk exposure to a largenumber of lenders across a wide geographical range. The value of loans and advances on thebalance sheet is significant and there is a high degree of complexity and judgmentinvolved for the Company in estimating individual and collective credit impairmentprovisions and write-offs against these loans. The Company's model to calculate expectedcredit loss (“ECL”) is inherently complex and judgment is applied in determiningthe correct construction of the three- stage impairment model (“ECL Model”)including the selection and input of forward-looking information. ECL provisioncalculations require the use of large volumes of data. The completeness and reliability ofdata can significantly impact accuracy of the modeled impairment provisions. The accuracyof data flows and the implementation of related controls are critical for the integrity ofthe estimated impairment provisions. Principal Audit Procedures:

We have started our audit procedures with understanding of the internal controlenvironment related to impairment loss allowance. Our procedures over internal controlsfocused on recognition and measurement of impairment loss allowance. We assessed thedesign and tested the operating effectiveness of the selected key controls implemented bythe Company. We also assessed whether the impairment methodology used by the company is inline with Ind AS 109 “Financial instruments” requirements. Particularly weassessed the approach of the Company regarding definition of default Probability ofDefault Loss Given Default and incorporation of forward-looking information for thecalculation of ECL. For loans and advances which are assessed for impairment on aportfolio basis we performed particularly the following procedures:

• We tested the reliability of key data inputs and related management controls;

• We checked the stage classification as at the balance sheet date as perdefinition of default of the company;

• We validated the ECL model and calculation by involving our InformationTechnology Expert;

• We have also calculated the ECL provision manually for a selected sample; and

• We have assessed the assumptions made by the Company in making acceleratedprovision considering forward looking information and based on an event in a particulargeographical range.

For loans and advances which are written off during the year under audit we read andunderstood the methodology and policy laid down and implemented by the Company in thisregards along with its compliance on sample basis.

Other Information

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Management Discussion &Analysis Director's Report and Corporate Governance Report but does not include theStandalone Financial Statements and our auditor's report thereon.

Our opinion on the Standalone Financial Statements does not cover the other informationand we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Financial Statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the Standalone Financial Statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated. If based on thework we have performed we conclude that there is a material misstatement of this otherinformation we are required to report that fact.

We have nothing to report in this regard.

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 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 changes in equity and cash flows of the Company in accordancewith the accounting principles generally accepted in India including Ind AS specifiedunder section 133 of the Act read with relevant rules issued thereunder. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation 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 this Standalone Financial Statements. As part of an audit inaccordance with SAs we exercise professional judgment and maintain professionalskepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the StandaloneFinancial Statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)

(i) of the Act we are also responsible for expressing our opinion on whether thecompany has adequate internal financial controls with reference to 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 other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the Standalone Financial Statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

OTHER MATTER

The comparative financial information of the Company for the year ended March 31 2019and the transition date opening balance sheet as at April 01 2017 included in theseStandalone Financial Statements are based on the previously issued statutory financialstatements prepared in accordance with the Accounting Standards Specified under Section133 of the Act read with relevant rules issued there under and other accounting principlesgenerally accepted in India audited by us in our report for the year ended March 31 2018dated April 27 2018 and predecessor auditor whose report for the year ended March 312017 dated April 27 2017 respectively expressed an unmodified opinion on those StandaloneFinancial Statements as adjusted for the differences in the accounting principles adoptedby the Company on transition to the Ind AS which have been audited by us.

Our opinion is not modified in respect of this matter.

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 section 143(11) of the Act we givein “Annexure 1” a statement on the matters specified in paragraphs 3 and 4 ofthe Order to the extent applicable.

(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 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;

c. The Balance Sheet the Statement of Profit and Loss (including Other ComprehensiveIncome) the Statement of Changes in Equity and the Statement of Cash Flows dealt with bythis report are in agreement with the books of account;

d. In our opinion the aforesaid Standalone Financial Statements comply with the IndianAccounting Standards specified under section 133 of the Act read with relevant rulesissued thereunder;

e. On the basis of the written representations received from the directors as on March31 2019 and taken on record by the Board of Directors none of the directors isdisqualified as on March 31 2019 from being appointed as a director in terms of section164(2) of the Act;

f. With respect to the adequacy of the internal financial controls with reference tofinancial statements of the Company and the operating effectiveness of such controls wegive our separate report in “Annexure 2”.

g. With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended;

In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid/ provided by the Company to its directors during theyear is in accordance with the provisions of section 197 of the Act;

h. With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 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 50 on Contingent Liabilitiesto the Standalone Financial Statements;

(ii) The Company did not have any material foreseeable losses in long term contractsincluding derivative contracts during the year ended March 31 2019;

(iii) There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund (IEPF) by the Company. As regards unpaid dividendamount of Rs. 27778/- transferred subsequently to IEPF reference is invited to Note 27to the Standalone Financial Statements.

For Haribhakti & Co. LLP For Pijush Gupta & Co.
Chartered Accountants Chartered Accountants
Firm Registration Number: 103523W/W100048 Firm Registration Number: 309015E
Sumant Sakhardande Sangeeta Gupta
Partner Partner
Membership Number: 034828 Membership Number: 064225
Mumbai Mumbai
May 08 2019 May 08 2019

ANNEXURE 1

TO THE INDEPENDENT AUDITOR'S REPORT

[Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements' in the Independent Auditor's

Report of even date to the members of Shriram Transport Finance Company Limited on thestandalone financial statements for the year ended March 31 2019]

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

(b) During the year the fixed assets of the Company have been physically verified bythe management and as informed no material discrepancies were noticed on suchverification. In our opinion the frequency of verification is reasonable having regard tothe size of the Company and the nature of its assets.

(c) According to the information and explanations given to us and based on theexamination of the registered sale deed/ transfer deed and other relevant recordsevidencing title / possession provided to us we report that the title deeds of all theimmovable properties comprising of land and buildings which are freehold other than selfconstructed assets included in Property Plant and Equipment are held in the name of theCompany as at the balance sheet date.

(ii) Company business does not involve any inventory and accordingly the requirementsunder paragraph 3(ii) of the order are not applicable to the company and hence notcommented upon.

(iii) As informed the Company has not granted any loans secured or unsecured tocompanies firms Limited Liability Partnerships or other parties covered in the registermaintained under section 189 of the Act. Accordingly paragraph 3 (iii)

(a) 3 (iii)(b) and 3 (iii)(c) of the Order are not applicable to the Company.

(iv) Based on information and explanation given to us in respect of loans investmentsGuarantees and securities the Company has complied with the provisions of section 185 and186(1) of the Act. Further the provisions of section 186 {except for sec 186(1)} the Actare not applicable to the Company as it is engaged in the business of financing.

(v) In our opinion and according to the information and explanations given to us theCompany has complied with the directives issued by Reserve Bank of India and theprovisions of sections 73 to 76 of the Act and the rules framed there under with regard tothe acceptance of deposits. Further as informed no Order has been passed by the CompanyLaw Board or National Company Law Tribunal or Reserve Bank of India or any Court or anyother Tribunal on the Company in respect of the aforesaid deposits.

(vi) The Central Government has not prescribed the maintenance of cost records for anyof the products of the Company under sub-section (1) of section 148 of the Act and therules framed there under.

(vii) (a) The Company is regular in depositing with appropriate authorities undisputedstatutory dues including provident fund employees' state insurance income tax goods andservice tax cess and any other material statutory dues applicable to it. As informedprovision of Sales Tax custom duty and excise duty are not applicable to the Company.

(b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income tax sales taxservice tax value added tax goods and service tax excise duty cess and any othermaterial statutory dues applicable to it were outstanding at the year end for a periodof more than six months from the date they became payable. As informed provision forsales tax custom duty and excise duty are not applicable to the company.

(c) According to the information and explanation given to us the dues outstanding withrespect to income tax sales tax service tax value added tax goods and service taxcustoms duty excise duty on account of any dispute are as follows:

Name of the statute Nature of dues Amount (' In lacs) Period to which the amount relates Forum where dispute is pending
Finance Act 1994 (Service tax Service tax on hire purchase and lease transaction 741.62 F.Y. 2003-04 to 2009-10 CESTAT (Custom Excise and Service tax appellate tribunal)
Finance Act 1994 (Service tax Service tax on Securitization collection commission income 19775.35 F.Y. 2007-08 to 2014-15 CESTAT (Custom Excise and Service tax appellate tribunal)
Finance Act 1994 (Service tax) Interest on Input Tax Credit reversal on CBLO income 9.45* F.Y. 2010-11 Commissioner of Central Excise and Customs (Appeals)
Maharashtra Value Added Tax Value added tax 0.20* F.Y. 2005-06 Maharashtra Sales Tax Tribunal
Maharashtra Value Added Tax Value added tax 0.15* F.Y. 2006-07 Deputy Commissioner of Sales Tax - Appeals - Mumbai
Name of the statute Nature of dues Amount (' In lacs) Period to which the amount relates Forum where dispute is pending
Maharashtra Value Added Tax Value added tax 567.82* F.Y. 2007-08 to 2013-14 Maharashtra Sales Tax Tribunal
Maharashtra Value Added Tax Value added tax 80.11* F.Y. 2014-15 Joint Commissioner of Sales Tax
Maharashtra Value Added Tax Value added tax 23.73* F.Y. 2012-13 to 2013-14 Deputy Commissioner of Sales Tax - Appeals - Mumbai
Andhra Pradesh Value Added Tax Value added tax 348.41* F.Y. 2005-06 to 2008-09 Andhra Pradesh High court
Andhra Pradesh Value Added Tax Value added tax 326.81* F.Y 2009-10 to 2010-11 and 1st April 2011 to 31st August 2012 Andhra Pradesh High court
Andhra Pradesh Value Added Tax Value added tax 11.96* F.Y. 2010-11 to 2012-13 Andhra Pradesh High court
Rajasthan Value Added Tax Value added tax 116.37* F.Y. 2006-07 to 2011-12 Rajasthan High Court
Rajasthan Value Added Tax Value added tax 159.48* F.Y. 2012-13 to 2015-16 and 1st April 2016 to 4th November 2016 Rajasthan Tax Tribunal
Odisha Value Added Tax Value added tax 9.04* F.Y. 2008-09 to 2012-13 Odisha Tax Tribunal
Karnataka Value Added Tax Value added tax 806.77* F.Y. 2010-11 to 2016-17 Karnataka High court
Income Tax Act 1961 Income Tax demands 2753.98 A.Y. 2016-17 CIT (Appeals)
Income Tax Act 1961 Income Tax demands 630.89 A.Y. 2014-15 Madras High Court
Income Tax Act 1961 Income Tax demands 179.58 A.Y. 2014-15 CIT (Appeals)
Income Tax Act 1961 Income Tax demands 502.12 A.Y. 2013-14 Assessing Officer
Income Tax Act 1961 Income Tax demands 102.5 A.Y. 2013-14 High Court
Income Tax Act 1961 Income Tax demands 527.48 A.Y. 2012-13 Assessing Officer
Income Tax Act 1961 Income Tax demands 53.12 A.Y. 2012-13 Assessing Officer
Income Tax Act 1961 Income Tax demands 999.96 A.Y. 2011-12 Assessing Officer
Income Tax Act 1961 Income Tax demands 6.46 A.Y. 2011-12 Madras High Court
Income Tax Act 1961 Income Tax demands 920.86 A.Y. 2010-11 Assessing Officer
Income Tax Act 1961 Income Tax demands 1026.06 A.Y. 2009-10 Madras High Court
Income Tax Act 1961 Income Tax demands 183.62 A.Y. 2008-09 Madras High Court
Income Tax Act 1961 Income Tax demands 27.28 A.Y. 2007-08 Madras High Court
Income Tax Act 1961 Income Tax demands 7.92 A.Y. 2006-07 Assessing Officer

*Net of amount paid under protest.

(viii) According to the information and explanations given to us the Company has notdefaulted in repayment of loans or borrowings to financial institutions banks or dues todebenture holders. There are no loans or borrowings from Government.

(ix) In our opinion and according to the information and explanations given to usmonies raised by the Company by way of debt instruments and term loans were applied forthe purpose for which those were raised though idle/surplus funds which were not requiredfor immediate utilization were gainfully invested in liquid assets payable on demand. TheCompany has not raised money by way of initial public issue offer / further public offerof equity during the year.

(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of fraud by the Company or any fraud on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such instance by themanagement.

(xi) According to the information and explanations given to us managerial remunerationhas been paid / provided in accordance with the requisite approvals mandated by theprovisions of section 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Therefore paragraph 3(xii) of the Order is not applicableto the Company.

(xiii) According to the information and explanation given to us all transactionsentered into by the Company with the related parties are in compliance with sections 177and 188 of Act where applicable and the details have been disclosed in the FinancialStatements etc. as required by the applicable accounting standards.

(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review. Thereforeparagraph 3(xiv) of the Order is not applicable to the Company.

(xv) According to the information and explanations given to us the Company has notentered into any non-cash transactions with directors or persons connected with him duringthe year.

(xvi) According to the information and explanation given to us the Company is requiredto be registered under section 45-IA of the Reserve Bank of India Act 1934 and theregistration has been obtained by the Company.

For Haribhakti & Co. LLP For Pijush Gupta & Co.
Chartered Accountants Chartered Accountants
Firm Registration Number: 103523W/W100048 Firm Registration Number: 309015E
Sumant Sakhardande Sangeeta Gupta
Partner Partner
Membership Number: 034828 Membership Number: 064225
Mumbai Mumbai
May 08 2019 May 08 2019

ANNEXURE 2

TO THE INDEPENDENT AUDITOR'S REPORT

[REFERRED TO IN PARAGRAPH 2 UNDER ‘REPORT ON OTHER LEGAL AND REGULATORYREQUIREMENTS' IN THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE TO THE MEMBERS OF SHRIRAMTRANSPORT FINANCE COMPANY LIMITED ON THE STANDALONE FINANCIAL STATEMENTS FOR THE YEARENDED MARCH 31 2019]

Report on the Internal Financial Controls with reference to Financial Statements underclause (i) of sub-section 3 of section 143 of the Companies Act 2013 (“theAct”)

We have audited the internal financial controls with reference to financial statementsof Shriram Transport Finance Company Limited (“the Company”) as of March 312019 in conjunction with our audit of the standalone financial statements of the Companyfor the year ended on that date. Management's Responsibility for Internal FinancialControls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control with reference to 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 (the “Guidance Note”) issued by the Institute of Chartered Accountantsof India(“ICAI”). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence tocompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to financial statements based on our audit. We conducted our auditin accordance with the Guidance Note and the Standards on Auditing specified under section143(10) of the Act to the extent applicable to an audit of internal financial controlsboth issued by the ICAI. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls with reference to financial statements wasestablished and maintained and if such controls operated effectively in all materialrespects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to financial statements and their operatingeffectiveness.

Our audit of internal financial controls with reference to financial statementsincluded obtaining an understanding of internal financial controls with reference tofinancial statements assessing the risk that a material weakness exists and testing andevaluating the design and operating effectiveness of internal controls 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 and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls withreference to financial statements.

Meaning of Internal Financial Controls with reference to Financial Statements

A company's internal financial control with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial control withreference to financial statements includes those policies and procedures that (1) pertainto the maintenance of records that in reasonable detail accurately and fairly reflectthe transactions and dispositions of the assets of the company;(2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls with reference to FinancialStatements

Because of the inherent limitations of internal financial controls with reference tofinancial statements including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls withreference to financial statements to future periods are subject to the risk that theinternal financial controls with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls with reference to financial statements and such internal financialcontrols with reference to financial statements were operating effectively as at March 312019 based on the internal control with reference to financial statements criteriaestablished by the Company considering the essential components of internal controlsstated in the Guidance Note issued by the ICAI.

For Haribhakti & Co. LLP For Pijush Gupta & Co.
Chartered Accountants Chartered Accountants
Firm Registration Number: 103523W/W100048 Firm Registration Number: 309015E
Sumant Sakhardande Sangeeta Gupta
Partner Partner
Membership Number: 034828 Membership Number: 064225
Mumbai Mumbai
May 08 2019 May 08 2019