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Sterling & Wilson Solar Ltd.

BSE: 542760 Sector: Engineering
NSE: SWSOLAR ISIN Code: INE00M201021
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OPEN 292.70
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VOLUME 254597
52-Week high 343.50
52-Week low 187.25
P/E
Mkt Cap.(Rs cr) 4,571
Buy Price 0.00
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Sell Price 0.00
Sell Qty 0.00
OPEN 292.70
CLOSE 291.25
VOLUME 254597
52-Week high 343.50
52-Week low 187.25
P/E
Mkt Cap.(Rs cr) 4,571
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sterling & Wilson Solar Ltd. (SWSOLAR) - Auditors Report

Company auditors report

To the Members of

Sterling and Wilson Solar Limited

Report on the Audit of the Standalone financial statements

qualified opinion

We have audited the standalone financial statements of Sterling andWilson Solar Limited (formerly known as Sterling and Wilson Solar Private Limited)("the Company") which comprise the standalone balance sheet as at 31 March2020 and the standalone statement of profit and loss (including other comprehensiveincome) standalone statement of changes in equity and standalone statement of cash flowsfor the year then ended and notes to the standalone financial statements including asummary of the significant accounting policies and other explanatory information in whichare included the Returns for the year ended on that date audited by the branch auditors ofthe Company's branches at Australia Argentina Chile Dubai Egypt Indonesia JordanKenya Mexico Namibia Philippines Vietnam and Zambia (hereinafter referred to as"standalone financial statements").

In our opinion and to the best of our information and according to theexplanations given to us and based on the consideration of reports of branch auditors onfinancial information of such branches as were audited by the branch auditors except forthe effects of the matter described in the Basis for Qualified Opinion section of ourreport the aforesaid standalone financial statements give the information required by theCompanies Act 2013 ('the Act') in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at 31 March 2020 its profit and other comprehensive incomechanges in equity and its cash flows for the year ended on that date.

basis for qualified opinion

We draw attention to note 54 to the standalone financial statementsrelating to extension in repayment period of outstanding inter-corporate deposits ofRs.17271.80 million (including interest accrued thereon of Rs.1708.20 million) as on 30September 2019 made to a fellow subsidiary by the Company from the 90 days period asstated in the Red Herring Prospectus dated 29 July 2019 for the purpose of Offer of Saleto public of Company's shares by the Selling Shareholders. The Selling Shareholders havefacilitated repayment of Rs.14576.23 million from the date of listing i.e. 20 August 2019to 31 March 2020 as per the schedule approved by the Board of Directors. Theintercorporate deposits outstanding (including interest accrued) as at 31 March 2020aggregate to Rs.5981.68 million.

The Company has received queries from SEBI Registrar of CompaniesMumbai (ROC) and certain shareholders regarding matters connected with delay infacilitating repayment of inter-corporate deposits by the Selling Shareholders on whichthe Company has submitted its replies. The Company has represented to us that based onindependent legal opinions obtained by it it is of the view that there is nonon-compliance with any laws and regulations by the Company in respect of this matter. Weare unable to evaluate the impact of adjustments if any that may arise from this matteron the standalone financial statements of the Company.

We conducted our audit in accordance with the Standards on Auditing(SAs) specified under Section 143(10) of the Act. Our responsibilities under those SAs arefurther described in the Auditor's Responsibilities for the Audit of the StandaloneFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thestandalone financial statements under the provisions of the Act and the Rules thereunderand we have fulfilled our other ethical responsibilities in accordance with theserequirements and the Code of Ethics. We believe that the audit evidence obtained by usalong with the consideration of audit reports of the branch auditors referred to inparagraph (a) of the "Other Matters" paragraph below is sufficient andappropriate to provide a basis for our qualified opinion on the standalone financialstatements.

key audit matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the standalone financial statements of thecurrent period. These matters were addressed in the context of our audit of the standalonefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. In addition to the matter described in the Basis forQualified Opinion section we have determined matters described below to be the key auditmatters to be communicated in our report.

Measurement of contract revenue and margin (refer note 2(d)(i) 3.1229 and 47 to the standalone financial statements)

The Key Audit Matter How the matter was addressed in our audit
Revenue from works contracts represents 86.96% of the total revenue from operations of the Company. In view of the significance of the matter we applied the following audit procedures in this area among others to obtain sufficient appropriate audit evidence:
Revenue from these contracts is recognised on satisfaction of performance obligation over time in accordance with the requirements of relevant accounting standards. Revenue recognition involves significant estimates related to measurement of costs to complete valuation of claims and penalties / liquidated damages and in turn evaluation of the related receivables and liabilities at each reporting date.
• Assessing compliance of the Company's policies in respect of revenue recognition with the applicable accounting standards;
• Evaluating the design and implementation and tested operating effectiveness of key internal controls around revenue recognition and recording of contract costs;
The Company uses input method based on costs to measure progress of individual contracts. Under this approach the Company recognises revenue and margin based on the costs incurred and accrued to date relative to the estimated total costs to complete the performance obligation. Penalties/ liquidated damages specified in the contracts are inherent in the determination of transaction price and forms part of variable consideration.
• Selecting a sample of contracts to test using risk-based criteria which included individual contracts with:
- significant revenue recognised during the year;
- nil margin; or
- significantly high low or negative profit margins.
Overstatement of revenue is considered to be a significant audit risk as it is the key driver of returns to investors and incentives linked to performance for a reporting period. • For these sample contracts we critically assessed the estimated costs to complete variations in contract price and contract costs and the adequacy of provision for penalties / liquidated damages arising from customer disputes. This assessment included:
Due to significant judgment involved in the estimate of total revenue costs to complete and significant audit risk of overstatement we have considered measurement of contract revenue as a key audit matter.
- inspection of original contracts and its amendments for key terms and milestones to verify the estimated total revenue and costs to complete and / or any changes thereto;
- interviewing and challenging project and commercial heads on changes to estimated total revenue and costs to complete and settlement and recoverability of contract related receivables;
- comparing revenue recorded during the year with the underlying contracts milestones achieved and invoices raised on the customers;
- sighting the correspondence and minutes of meeting with customers around recoverability of claims and penalties / liquidated damages.
• Assessing the costs incurred and accrued to date on the balance sheet by examining underlying invoices and signed contracts;
• Appropriate cut-off procedures for determination of revenue in the correct reporting period;
• Comparing on a sample basis the outcome of contracts completed during the year with the original budgets and estimated margins for those contracts to determine the reliability of previous estimates;
• Comparing details of a sample of revenue journal entries raised throughout the reporting period using risk-based criteria with the relevant underlying documentation;
• Considering the adequacy of disclosures made in note 2(d)(i) to the Company's standalone financial statements in respect of these judgments and estimates.

Recoverability of inter-corporate deposits / loans to group companies(refer note 2(d](vi] 3.9 and 15 to the standalone financial statements]

The Key Audit Matter How the matter was addressed in our audit
The carrying amount of inter- corporate deposits / loans to group companies represents 24.24% of the Company's total assets. In view of the significance of the matter we applied the following audit procedures in this area among others to obtain sufficient appropriate audit evidence:
The Company has extended inter-corporate deposits / loans to group companies which are assessed for recoverability at each period end. • Evaluating the design and implementation of key internal controls. We tested operating effectiveness of controls placed around the recognition of loss allowance for expected credit losses on the inter-corporate deposits / loans to group companies;
Due to the nature of construction industry in which borrower operates the Company is exposed to heightened risk in respect of the recoverability of inter- corporate deposits / loans granted to these group companies.
• Testing the key controls in place for issuing new intercorporate deposits / loans compliance with provisions of the Companies Act 2013 and inspecting the Board approvals obtained;
Considering their relative significance vis-a-vis the total assets of the Company and extension of repayment schedule of certain inter-corporate deposits they are considered to have a major effect on our overall audit strategy and planning. • Testing Company's assessment of the recoverability of inter-corporate deposits / loans. We tested the Company's assessment of the cash flows the Company expects to receive;
We have identified measurement of inter-corporate deposits / loans to group companies as key audit matter because recoverability assessment involves Company's significant judgement and estimate. • We checked the net worth of group companies on the basis of latest available financial statements;
• Inspecting the correspondence in respect of the commitment provided by the shareholders of the borrower group companies used by the Company to assess significant increase in credit risk on inter-corporate deposits / loans. This assessment was made by the Company as at balance sheet date.
• Checking the Company's computation of contractual cash flows due to the Company in accordance with the contract;
• Checking the measurement of expected credit loss recognised;
• Testing the payments made / receipts received in relation to these inter-corporate deposits / loans during the year through bank statement;
• Obtaining external confirmation of inter- corporate deposits / loans held by group companies as on 31 March 2020.

OTHER INFORMATION

The Company's management and Board of Directors are responsible for theother information. The other information comprises the information included in theCompany's annual report but does not include the standalone financial statements and ourauditors' report thereon.

Our opinion on the standalone financial statements does not cover theother information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statementsour responsibility is to read the other information

and in doing so consider whether the other information is materiallyinconsistent with the standalone financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed and based on the work done/ audit report of branch auditors we conclude thatthere is a material misstatement of this other information we are required to report thatfact. As described in the Basis for Qualified Opinion section above we are unable to ievaluate the impact of adjustments if any that may arise from the said matter on thestandalone financial statements of the Company. Accordingly we are unable to concludewhether or not the other information is materially misstated with respect to the saidmatter.

MANAGEMENT'S AND BOARD OF DIRECTORS' RESPONSIBILITY FOR THE STANDALONEFINANCIAL STATEMENTS

The Company's Management and Board of Directors are responsible for thematters stated in Section 134(5) of the Act with respect to the preparation of thesestandalone financial statements that give a true and fair view of the state of affairsprofit/loss and other comprehensive income changes in equity and cash flows of theCompany in accordance with the accounting principles generally accepted in Indiaincluding the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act.This responsibility also includes maintenance of adequate accounting records in accordancewith the provisions of the Act for safeguarding of the assets of the Company and forpreventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring accuracy and completeness of theaccounting records relevant to the preparation and presentation I of the standalonefinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

In preparing the standalone financial statements the Management andBoard of Directors are responsible for I assessing the Company's ability to continue as agoing concern disclosing as applicable matters related to going concern and using thegoing concern basis of accounting unless the Board of Directors either intends toliquidate the Company or to cease operations or has no realistic alternative but to doso.

The Board of Directors is also responsible for overseeing the Company'sfinancial reporting process.

AUDITOR'S RESPONSIBILITIES FOR THE AUDIT OF THE STANDALONE FINANCIALSTATEMENTS

Our objectives are to obtain reasonable assurance about whether thestandalone financial statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these standalone financial statements.

As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also: I

• Identify and assess the risks of material misstatement of thestandalone financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as

I fraud may involve collusion forgery intentional omissionsmisrepresentations or the override of internal control.

• Obtain an understanding of internal control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. UnderSection 143(3) (i) of the Act we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls with reference to standalonefinancial statements in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures in the standalone financialstatements made by the Management and Board of Directors.

• Conclude on the appropriateness of the Management and Board ofDirectors use of the going concern basis of accounting and based on the audit evidenceobtained whether a material uncertainty exists related to events or conditions that maycast significant doubt on the Company's ability to continue as a going concern. If weconclude that a material uncertainty exists we are required to draw attention in ourauditor's report to the related disclosures in the standalone financial statements or ifsuch disclosures are inadequate to modify our opinion. Our conclusions are based on theaudit evidence obtained up to the date of our auditor's report. However future events orconditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of thestandalone financial statements including the disclosures and whether the standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding thefinancial information of the branches of the Company to express an opinion on thestandalone financial statements. We are responsible for the direction supervision andperformance of the audit of financial information of such branches included in thestandalone financial statements of which we are the independent auditors. For the otherbranches included in the standalone financial statements which have been audited bybranch auditors such branch auditors remain responsible for the direction supervisionand performance of the audits carried out by them. i We remain solely responsible for ouraudit opinion. Our responsibilities in this regard are further described in paragraph (a)of the section titled "Other Matters" in this audit report.

We communicate with those charged with governance regarding amongother matters 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 wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the standalonefinancial statements of the current period and are therefore the key audit matters. Wedescribe these matters in our auditors' report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.

OTHER MATTERS

(a) We did not audit the financial information of 13 branches includedin the standalone financial statements of the Company whose financial information reflecttotal assets of Rs.6376.71 million as at 31 March 2020 and the total revenue ofRs.6673.59 million for the year ended on that date as considered in the standalonefinancial statements. These branches have been audited by the branch auditors whosereports have been furnished to us and our opinion in so far as it relates to the amountsand disclosures included in respect of branches is based solely on the report of suchbranch auditors.

(b) Certain of these branches are located outside India whose financialstatements and other financial information have been prepared in accordance withaccounting principles generally accepted in their respective countries and which have beenaudited by branch auditors under generally accepted auditing standards applicable in theirrespective countries. The Company's management has converted the financial statements ofthese branches located outside India from accounting principles generally accepted intheir respective countries to accounting principles generally accepted in India. We haveaudited these conversion i

i adjustments made by the Company's management. Our opinion in so faras it relates to the balances and affairs of such branches located outside India is basedon the report of branch auditors and the conversion adjustments prepared by the managementof the Company and audited by us.

Our opinion is not modified in respect of the above matters.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

As required by the Companies (Auditor's Report) Order 2016 ('theOrder') issued by the Central Government of India in terms of Section 143 (11) of theAct we give in the "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.

(A) As required by Section 143 (3) of the Act we report that:

(a) we have sought and except for the matter described in the Basisfor Qualified Opinion paragraph obtained all the information and explanations which tothe best of our knowledge and belief were necessary for the purposes of our audit;

(b) except for the effects of the matter described in the Basis forQualified Opinion paragraph above in our opinion proper books of account as required bylaw have been kept by the Company so far as it appears from our examination of those booksand proper returns adequate for the purposes of our audit have been received from thebranches not visited by us;

(c) the reports on the accounts of the branch offices of the Companyaudited under Section 143(8) of the Act by branch auditors have been sent to us and havebeen properly dealt with by us in preparing this report;

(d) except for the effects of the matter described in the Basis forQualified Opinion paragraph above in our opinion the standalone balance sheet thestandalone statement of profit and loss (including other comprehensive income) thestandalone statement of changes in equity and the standalone statement of cash flows dealtwith by this report are in agreement with the books of account and with the returnsreceived from the branches not visited by us;

(e) except for the effects of the matter described in the Basis forQualified Opinion paragraph above in our opinion the aforesaid standalone financialstatements comply with the Indian Accounting Standards (Ind AS) specified under Section133 of the Act;

(f) on the basis of the written representations received

i from the directors as on 31 March 2020 taken

on record by the Board of Directors none of the directors isdisqualified as on 31 March 2020 from being appointed as a director in terms of Section164 (2) of the Act; and

(g) with respect to the adequacy of the internal financial controlswith reference to the standalone financial statements of the Company and the operatingeffectiveness of such controls refer to our separate Report in "Annexure B".

(B) With respect to the other matters to be included in the Auditors'Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 inour opinion and to the best of our information and according to the explanations given tous:

i. the Company has disclosed the impact of pending litigations as at 31March 2020 on its financial position in its standalone financial statements - Refer Note42 to the standalone financial statements;

ii. the Company has made provision as required under the applicablelaw or accounting standards for material foreseeable losses if any on long-termcontracts including derivative contracts - Refer Note 24 to the standalone financialstatements;

iii. there has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company during the yearended 31 March 2020; and

I iv. the disclosures in the standalone financial statements regardingholdings as well as dealings in Specified I Bank Notes during the period from 8 November2016

I to 30 December 2016 have not been made in these

standalone financial statements since they do not I pertain to thefinancial year ended 31 March 2020.

(C) With respect to the matter to be included in the Auditors' Reportunder Section 197 (16) of the Act we report that:

In our opinion and according to the information and explanations givento us the remuneration paid by the Company to its directors during the current year is inI accordance with the provisions of Section 197 of the Act.

The remuneration paid to any director is not in excess I of the limitlaid down under Section 197 of the Act. The Ministry of Corporate Affairs has notprescribed other details under Section 197(16) which are required to be I commented uponby us.

For B S R & Co. LLP
Chartered Accountants
Firm's Registration No: 101248W/W-100022
Aniruddha godbole
Partner
Mumbai Membership No: 105149
23 June 2020 UDIN: 20105149AAAAED2850

Annexure A to the Independent Auditors' Report - 31 March 2020

With reference to the Annexure A referred to in the IndependentAuditors' Report to the members of the Company on the standalone financial statements forthe year ended 31 March 2020 we report the following:

(i) (a) The Company has maintained proper records showing

full particulars including quantitative details and situation ofproperty plant and equipment.

(b) The Company has a regular programme of physical verification of itsproperty plant and equipment by which the property plant and equipment are verified bythe management according to a phased programme designed to cover all the items over aperiod of three years. In our opinion this periodicity of physical verification isreasonable having regard to the size of the Company and the nature of its assets. Inaccordance with the policy the Company has physically verified certain property plantand equipment during the year and no discrepancies were noticed in respect of assetsverified during the year.

(c) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company does not have anyimmovable properties. Accordingly paragraph 3 (i) (c) of the Order is not applicable tothe Company.

(ii) The inventory of project land stores and spare parts andconstruction materials has been physically verified by the management during the year. Inour opinion the frequency of such verification is reasonable. The discrepancies noticed on verification between the physical sto cks and the book records were not material andthese have been properly dealt with in the books of account.

(iii) The Company has granted unsecured loans to three companies twobody corporates and a partnership firm covered in the register maintained under Section189 of the Companies Act 2013 ('the Act'). The Company has not granted any loans securedor unsecured to limited liability partnerships or other parties covered in the registerrequired to be maintained under Section 189 of the Act.

i) According to the information and explanations given to us and basedon the audit procedures conducted by us we are of the opinion that the rate of interestand other terms and conditions of unsecured loans granted by the Company to companiesbody corporates and a partnership firm covered in the register required to be maintainedunder Section 189 of the Act are not prima facie prejudicial to the interest of theCompany.

I ii) According to the information and explanations given to us andbased on the audit procedures conducted by us the unsecured loans granted to thecompanies and the interest thereon are repayable on demand or repayable as per contractualterms of inter-corporate deposit agreements and the unsecured loans granted to bodycorporates and a partnership firm and the interest thereon are repayable on demand. Theborrowers have been regular in payment of principal and interest as demanded. Also refernote 54 to the standalone financial statements.

iii) There are no overdue amounts of more than 90 days in respect ofthe unsecured loans granted to companies body corporates and a partnership firm by theCompany. Also refer note 54 to the standalone financial statements.

(iv) In our opinion and according to the information and explanationsgiven to us and based on the audit procedures conducted by us the Company has compliedwith the provisions of Sections 185 and 186 of the Act with respect to loans grantedguarantees provided and investments made by the Company. The Company has not provided anysecurity in connection with a loan to any other body corporate or person and accordinglycompliance under

I Sections 185 and 186 of the Act in respect of providing securities isnot applicable to the Company.

(v) In our opinion and according to the information and explanationsgiven to us the Company has not accepted deposits as per the directives issued by theReserve Bank of India and the provisions of Sections 73 to 76 or any other relevantprovisions of the Act and the rules framed thereunder. Accordingly paragraph 3 (v) of theOrder is not applicable to the Company.

(vi) We have broadly reviewed the books of accounts maintained by theCompany pursuant to the rules prescribed by the Central Government for the maintenance ofcost records under Section 148(1) of the Act and are of the opinion that prima facie theprescribed accounts and records have been made and maintained. However we have not made adetailed examination of the records.

(vii) (a) According to the information and explanations given

to us and on the basis of our examination of records of the Companyamounts deducted / accrued in the books of account in respect of undisputed statutory duesincluding Provident fund Employees' State Insurance Professional tax Social Securitytax Cess and other material statutory dues have been regularly deposited during the yearby the Company with the

appropriate authorities. Amounts deducted / accrued in the books ofaccount in respect of undisputed statutory dues of Income-tax and Goods and Service taxhave generally been regularly deposited during the year by the Company with theappropriate authorities though there have been slight delays in a few cases.

According to the information and explanations given to us noundisputed amounts payable in respect of

Income-tax Goods and Service tax Cess and other material statutorydues were in arrears as at 31 March 2020 for a period of more than six months from thedate they became payable.

(b) According to the information and explanations given to us thereare no dues of Income-tax and Goods and Service tax as at 31 March 2020 which have notbeen deposited with the appropriate authorities on account of any dispute except asstated below:

.
Name of the statute nature of the dues Demand Rs.in million Amount paid under protest Rs.in million Financial year (F.V.) to which the amount relates Forum where dispute is pending
Central Goods and Services CGST interest 700.70 31.50 2017-18 Appellate Joint
Tax Act 2017 * and penalty Commissioner Vijaywada
Andhra Pradesh Goods and SGST interest 700.70 31.50 2017-18 Appellate Joint
Services Tax Act 2017 * and penalty Commissioner Vijaywada

* refer note 42 to the standalone financial statements.

(viii) In our opinion and according to the information and explanationsgiven to us the Company has not defaulted during the year in repayment of loans orborrowings to banks or financial institutions or dues to debenture holders. The Companydoes not have any loans or borrowings from government during the year.

(ix) According to the information and explanations given to us andbased on our examination of the records of the Company the Company has not raised anymoneys by way of initial public offer or further public offer (including debt instruments)and has not obtained any term loans during the year. Accordingly paragraph 3 (ix) of theOrder is not applicable to the Company. Also refer note 19(E) to the standalone financialstatements.

(x) During the course of our examination of the books and records ofthe Company carried out in accordance with the generally accepted auditing practices inIndia and according to the information and explanations given to us we have neither comeacross any instance of material fraud by the Company or on the Company by its officers oremployees noticed or reported during the year nor have we been informed of any such caseby the management.

(xi) According to the information and explanations given to us andbased on our examination of the records of the Company the remuneration paid by thecompany to its directors during the current year is in accordance with the provisions ofSection 197 of the Act. The remuneration paid to any director is not in excess of thelimit laid down under Section 197 of the Act.

(xii) In our opinion and according to the information and explanationsgiven to us the Company is not a Nidhi company and the Nidhi Rules 2014 are notapplicable to it. Accordingly paragraph 3 (xii) of the Order is not applicable to theCompany.

i (xiii) In our opinion and according to the information and Jexplanations given to us the Company has entered into

transactions with related parties in compliance with the . i provisionsof Sections 177 and 188 of the Act. The details of such related party transactions havebeen disclosed in the standalone financial statements as required by Indian AccountingStandard (Ind AS) 24 Related Party Disclosures j specified under Section 133 of the Act.

j (xiv) According to the information and explanations given to t us andbased on our examination of the records of the

j Company the Company has not made any preferential allotment orprivate placement of shares or fully or partly

! convertible debentures during the year. Accordingly

paragraph 3 (xiv) of the Order is not applicable to the Company.

i !

(xv) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company has not enteredinto any non- cash transactions with directors or persons connected with them.Accordingly paragraph 3 (xv) of the Order is not

applicable to the Company.

(xvi) In our opinion and according to the information and explanationsgiven to us the Company is not required to be registered under Section 45-IA of theReserve Bank of

; India Act 1934. Accordingly paragraph 3 (xvi) of the Order is notapplicable to the Company.

For B S R & Co. LLP
Chartered Accountants
Firm's Registration No: 101248W/W-100022
Aniruddha Godbole
Partner
Mumbai Membership No: 105149
23 June 2020 UDIN: 20105149AAAAED2850

Annexure B to the Independent Auditors' Report - 31 March 2020

Report on the internal Financial controls with reference to theaforesaid standalone financial statements under clause (i) of Sub-section 3 of Section 143of the companies Act 2013 ("the Act")

(Referred to in paragraph (A) (g) under 'Report on Other Legal andRegulatory Requirements' section of our report of even date)

OPINION

We have audited the internal financial controls with reference tostandalone financial statements of Sterling and Wilson Solar Limited (formerly known asSterling and Wilson Solar Private Limited] ("the Company"] as of 31 March 2020in conjunction with our audit of the standalone financial statements of the Company forthe year ended on that date.

In our opinion the Company has in all material respects adequateinternal financial controls with reference to standalone financial statements and suchinternal financial controls were operating effectively as at 31 March 2020 based on theinternal financial controls with reference to standalone financial statements 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 (the "Guidance Note"].

MANAGEMENT'S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS

The Company's management and the Board of Directors are responsible forestablishing and maintaining internal financial controls based on the internal financialcontrols with reference to standalone financial statements criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote. These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to the Company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

AUDITORS' RESPONSIBILITY

Our responsibility is to express an opinion on the Company's internalfinancial controls with reference to standalone

financial statements based on our audit. We conducted our audit inaccordance with the Guidance Note and the Standards on Auditing prescribed under Section143(10] of the Act to the extent applicable to an audit of internal financial controlswith reference to standalone financial statements. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls with reference tostandalone financial statements were established and maintained and whether such controlsoperated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls with reference to standalone financialstatements and their operating effectiveness. Our audit of internal financial controlswith reference to standalone financial statements included obtaining an understanding ofsuch internal financial controls assessing the risk that a material weakness exists andtesting and evaluating the design and operating effectiveness of internal control based onthe assessed risk. The procedures selected depend on the auditors' judgement includingthe assessment of the risks of material misstatement of the standalone financialstatements whether due to fraud or error.

We believe that the audit evidence we have obtained and the auditevidence obtained by the branch auditors in terms of their report referred to in the OtherMatter paragraph below is sufficient and appropriate to provide a basis for our auditopinion on the Company's internal financial controls with reference to standalonefinancial statements.

MEANING OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO STANDALONEFINANCIAL STATEMENTS

A company's internal financial controls with reference to 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 controls with reference to financial statements include those policies andprocedures that (1] pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany; (2] provide reasonable assurance that transactions are recorded as necessary topermit preparation of financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and (3]provide

reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.

INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TOSTANDALONE FINANCIAL STATEMENTS

Because of the inherent limitations of internal financial controls withreference to standalone financial statements including the possibility of collusion orimproper management override of controls material misstatements due to error or fraud mayoccur and not be detected. Also projections of any evaluation of the internal financialcontrols with reference to standalone financial statements to future periods are subjectto the risk that the internal financial controls with reference to standalone financialstatements may become inadequate because of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate.

OTHER MATTER

We did not audit the internal financial controls with reference tofinancial information of 13 branches (in Argentina Chile Dubai Egypt Jordan KenyaNamibia Philippines Vietnam and Zambia] of the Company. The internal financial controlswith reference to financial statements of these branches have been audited by the branchauditors whose reports have been furnished to us and our opinion in so far as it relatesto the internal financial controls with reference to financial statements included inrespect of these branches is based solely on the report of such branch auditors.

Our opinion is not modified in respect of this matter.

For B S R & Co. LLP
Chartered Accountants
Firm's Registration No: 101248W/W-100022
Aniruddha Godbole
Partner
Mumbai Membership No: 105149
23 June 2020 UDIN: 20105149AAAAED2850

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