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UltraTech Cement Ltd.

BSE: 532538 Sector: Industrials
NSE: ULTRACEMCO ISIN Code: INE481G01011
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NSE 00:00 | 18 Jun 6693.90 -10.95
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OPEN 6690.00
PREVIOUS CLOSE 6708.15
VOLUME 11556
52-Week high 7050.00
52-Week low 3614.25
P/E 35.43
Mkt Cap.(Rs cr) 193,215
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 6690.00
CLOSE 6708.15
VOLUME 11556
52-Week high 7050.00
52-Week low 3614.25
P/E 35.43
Mkt Cap.(Rs cr) 193,215
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

UltraTech Cement Ltd. (ULTRACEMCO) - Auditors Report

Company auditors report

To the Members of

UltraTech Cement Limited

ReporTon the AudiTof the Standalone Financial Statements

Opinion

We have audited the standalone financial statements of UltraTech Cement Limited("the Company") which comprise the standalone balance sheet as at 31 March2020 and the standalone statemenTof profit and loss (including other comprehensiveincome) standalone statemenTof changes in equity and standalone statemenTof cash flowsfor the year then ended and notes to the standalone financial statements including asummary of the significant accounting policies and other explanatory information(hereinafter referred to as "the standalone financial statements").

In our opinion and to the besTof our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 ("Act") in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at 31 March 2020 and profit and other comprehensiveincome changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act. Our responsibilities under those SAs are furtherdescribed in the Auditor's Responsibilities for the AudiTof the Standalone FinancialStatements section of our report. We are independenTof the Company in accordance withthe Code of Ethics issued by the Institute of Chartered Accountants of India together withthe ethical requirements that are relevant to our audiTof the standalone financialstatements under the provisions of the Act and the Rules thereunder and we have fulfilledour other ethical responsibilities in accordance with these requirements and the Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our opinion on the standalone financial statements.

Emphasis of matter

1. W e draw attention to Note 37 of the standalone financial statements which statesthat the Scheme of Demerger of Cement division of Century Textiles and Industries Limited("Demerged Cement Division") ("the Scheme") has been given effectbased on the Appointed Date of 20 May 2018 as approved by the National Company LawTribunal which is deemed to be the acquisition date for the purpose of accounting underInd AS 103 ‘Business Combinations'. Consequently financial information for the yearended 31 March 2019 included in these standalone financial statements has been restated.Our opinion is not modified in respecTof this matter.

2. W e draw attention to Note 33 (b) of the standalone financial statements whichrefers to the following matters:

(a) In terms oForder dated 31 August 2016 the Competition Commission of India(‘CCI') had imposed penalty of Rs.1449.51 crores for alleged contravention of theprovisions of the Competition Act 2002 by the Company (including Demerged CementDivision). The Company (including Demerged Cement Division) had filed an appeal againstthe CCI Order before the Competition Appellate Tribunal ("COMPAT"). Consequentto reconstitution of Tribunals by the Government this matter was transferred to theNational Company Law Appellate Tribunal ("NCLAT"). NCLAT completed its hearingon the matter and disallowed the appeal filed by the Company (including Demerged CementDivision) against the CCI order. Aggrieved by the order of NCLAT the Company (includingDemerged Cement Division) has filed an appeal before the Honorable Supreme Court whichhas granted a stay against the NCLATorder on the condition that the Company (includingDemerged Cement Division) deposits 10% of the penalty amounting to Rs. 144.95 crores whichhas been deposited. Based on a competent legal opinion obtained by the Company (includingDemerged Cement Division) the Company believes that it has a good case in this matter.Considering the uncertainty relating to the outcome of this matter pending hearing of thecase by the Supreme Court no provision has been considered in the books of account. Ouropinion is not modified in respecTof this matter.

(b) In terms oForder dated 19 January 2017 the CCI had imposed penalty of Rs.68.30crores pursuant to a reference filed by the GovernmenTof Haryana for alleged contraventionof the provisions of the Competition Act 2002 in August 2012 by the Company. The Companyhad filed an appeal before COMPAT and received the stay order dated 10 April 2017.Consequent to reconstitution of Tribunals by the Government this matter was transferredto the NCLAT for which hearing is pending. Based on a competent legal opinion the Companybelieves that it has a good case in this matter. Considering the uncertainty relating tothe outcome of this matter pending hearing of the case no provision has been consideredin the books of account. Our opinion is not modified in respecTof this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audiTof the standalone financial statements of the current year. Thesematters were addressed in the contexTof our audiTof the standalone financial statements asa whole and in forming our opinion thereon and we do not provide a separate opinion onthese matters.

Description of Key Audit Matter

Key Audit Matters How the matter was addressed in our audit
Revenue recognition – Discounts incentives and rebates
[Refer note 1(B)(p) and 54 to the standalone financial statements] Our audit procedures included:
• Revenue is measured neTof discounts incentives rebates etc. given to the customers on the Company's sales. • We have assessed the Company's accounting policies e relating to revenue discounts incentives and rebates by comparing with applicable accounting standards.
• The Company's presence across different marketing regions within the country and the competitive business environment makes the assessmenTof various types of discounts incentives and rebates as complex and judgmental. • We have assessed the design and implementation and e tested the operating effectiveness of Company's internal controls over the provisions approvals and disbursements of discounts incentives and rebates.
• Therefore there is a risk of revenue being misstated as a resulTof variations in the assessmenTof discounts incentives and rebates. • We have assessed the Company's computations for e accrual of discounts incentives and rebates on a sample basis and compared the accruals made with the approved schemes and underlying documents.
• Given the complexity and judgement required to assess the provision for discounts incentives and rebates this is a key audit matter. • We have verified on a sample basis the underlying e documentation for discounts incentives and rebates recorded and disbursed during the year.
• We have compared the historical trend of payments and reversal of discounts incentives and rebates to provisions made to assess the current year accruals.
• We h examined the manual journals posted to have discounts rebates and incentives to identify unusual or irregular items.
Regulations - Litigations and claims
[Refer note 33 to the standalone financial statements] Our audit procedures included:
• The Company operates in various states within India and is exposed to different Central and State/Local laws regulations and interpretations thereof. In this regulatory environment there is an inherent risk of litigations and claims. • We have gained an understanding of outstanding litigations against the Company from the Company's in- house legal counsel and other key managerial personnel who have knowledge of these matters.
• Consequently provisions and contingent liability disclosures may arise from indirect tax proceedings legal proceedings including regulatory and other government/ department proceedings as well as investigations by authorities and commercial claims. • We have read the correspondence between the Company e and the various tax/legal authorities and the legal opinions of external legal advisors where applicable for significant matters.
• The Company applies significant judgement in estimating the likelihood of the future outcome in each case and in determining the provisions or disclosures required for each matter. • We have tested the completeness of the litigations and claims by examining on a sample basis the Company's legal expenses and minutes of the board meetings.
• Resolution of tax and legal proceedings may span over multiple years due to the highly complex nature and magnitude of the legal matters involved and may involve protracted negotiation or litigation. • We have challenged the Company's estimate of the have possible outcome of the disputed cases based on applicable tax laws and legal precedence by involving our tax specialists.
• These estimates could change significantly over time as new facts emerge and each legal case progresses. • We have assessed the adequacy of the Company's disclosures in respecTof contingent liabilities for tax and legal matters.
• Given the inherent complexity and magnitude of potential exposures and the judgement necessary to estimate the amounTof provisions required or to determine required disclosures this is a key audit matter.
Business combination - Acquisition of Cement Division of Century Textiles and Industries Limited ("Demerged Cement Division")
[Refer note 37 to the standalone financial statements] Our audit procedures included:
• The Company has completed the acquisition of Cement Division of Century Textiles and Industries Limited effective 1 October 2019 pursuant to a Scheme of Arrangement (‘the Scheme'). • We have read the Scheme and the NCLTOrder documents to understand the key terms and conditions of the acquisition.
• The Scheme was approved by the National Company Law Tribunal (NCLT) with an appointed date of 20 May 2018. • We have compared the accounting treatment specified in the Scheme with the one specified in Ind AS 103.
• The Company has accounted for such acquisition as a business combination as per Ind AS 103 ‘Business Combinations' by recognizing identifiable assets and liabilities at fair value. • We have assessed the competence and objectivity of the e experts engaged by the Company.
• The measuremenTof the identifiable assets and liabilities acquired at fair value is inherently judgmental. • We have critically evaluated the key assumptions purchase price allocation adjustments and the identification and valuation of acquired intangible assets by involving our valuation specialists and based on our knowledge of the Company and the industry.
• Fair have was determined by the Company with the value assistance of an external valuation expert using various valuation models which were applied according to the assets and liabilities being measured. • We have involved our valuation specialists to gain an e understanding of the work of the experts by examining the valuation reports.
• Given the complexity and judgement involved in fair value measurements and magnitude of the acquisition made by the Company this is a key audit matter. • We have assessed the adequacy of the Company's disclosures in respecTof the acquisition in accordance with the requirements of Ind AS 103.
Recognition and measuremenTof Income Taxes
(Refer note 18 and 41 to the standalone financial statements) Our audit procedures included:
• The Company operates in a complex tax jurisdiction and is subject to periodicchallenges by tax authorities on various matters relating to claims for tax exemptions / deductions. We have obtained an understanding of key tax matters.
• The determination of provision for income tax and deferred taxes including write backs of provisions involves significant judgements and estimates and interpreting the prevailing tax laws and rules. • We have read and analysed select key correspondences e external legal opinions/ consultations obtained by the Company for key tax matters.
• These also involve significant judgment to determine the possible outcome of the uncertain tax positions consequently haveing an impacTon related accounting and disclosures in the standalone financial statements. • We have critically challenged the key assumptions made e by the Company in estimating current and deferred taxes by involving our tax specialists.
• Considering the complexity and significant level of estimation and judgement this is a key audit matter. • We have challenged the Company's estimate of the have possible outcome of the disputed tax cases by considering legal precedence and other judicial rulings by involving our tax specialists.
• We have assessed the adequacy of the Company's disclosures for income taxes in the standalone financial statements.
Adoption of Ind AS 116 - Leases
(Refer note 1(B)(q) and 3 of the standalone financial statements) Our audit procedures included:
• The Company adopted Ind AS 116 ‘Leases' (Ind AS 116) with effect from 1 April 2019. • We have obtained an understanding of the Company's e processes and controls for adoption of Ind AS 116.
• The application and transition to this accounting standard is complex and is an area of focus in our audit since the Company has a large number of leases with different contractual terms. • We have assessed the Company's evaluation on the e identification of leases based on the contractual agreements and our knowledge of the business. Upon transition as at 1 April 2019:
• Ind AS 116 introduces a new lease accounting model wherein lessees are required to recognise a right-of-use (ROU) asset and a lease liability arising from a lease on the balance sheet. • We have evaluated the method of transition practical expedients applied.
• The l liabilities are initially measured by discounting ease future lease payments during the lease term as per the contract/ arrangement. • We have tested the completeness of the data by reconciling the Company's operating lease commitments to data used in computing ROU asset and lease liabilities.
• Adoption of the standard involves significant judgements and estimates in determination of the discount rates and the lease term including termination and renewal options. • We have evaluated the computation of lease liabilities on a sample of lease contracts and challenged the key estimates such as discount rates and the lease term.
• Additionally Ind AS 116 requires detailed disclosures in respecTof transition. • We have assessed the presentation and disclosures e relating to Ind AS 116 including disclosures relating to transition.
• Considering the judgements and complexities involved in transitioning to this new standard this is a key audit matter.

Other Information

The Company's management and Board of Directors are responsible for the otherinformation. The other information comprises the information included in the Company'sannual report but does not include the standalone financial statements and our auditors'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 audiTof 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 audiTor otherwise appears to be materially misstated. If based on thework we have performed we conclude that there is a material misstatemenTof this otherinformation we are required to report that fact. We have nothing to report in thisregard.

Management's and Board of Directors' Responsibility for the Standalone FinancialStatements

The Company's Management and Board of Directors are responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these standalone financialstatements that give a true and fair view of the state of affairs profit and othercomprehensive income changes in equity and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring accuracy and completeness of the accounting records relevant tothe preparation and presentation of the standalone financial statements that give a trueand fair view and are free from material misstatement whether due to fraud or error.

In preparing the standalone financial statements the Management and Board of Directorsare responsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless the Board of Directors either intends to liquidate the Companyor to cease operations or has no realisticalternative but to do so.

The Company's Management and Board of Directors are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibilities for the AudiTof 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 economicdecisions of userstaken on the basis of these standalone financial statements.

As parTof an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

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

Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theAct we are also responsible for expressing our opinion on whether the company hasadequate internal financial controls with reference to standalone financial statements inplace and the operating effectiveness of such controls.

Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures in the standalone financial statements madeby the Management and Board of Directors.

Conclude on the appropriateness of the Management and Board of Directors use of thegoing concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubTon the Company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor's report tothe related disclosures in the standalone financial statements or if such disclosures areinadequate to modifYour opinion. Our conclusions are based on the audit evidence obtainedup to the date of our auditor's report. However future events or conditions may cause theCompany to cease to continue as a going concern.

Evaluate the overall presentation structure and contenTof the standalone financialstatements including the disclosures and whether the standalone financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

We communicate with those charged with governance regarding among 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 audiTof the standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditors' report unless law or regulation precludes publicdisclosure 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 publicinterest benefits of such communication.

Other Matter

We did not audit the financial statements of the Demerged Cement Division asconsidered in these standalone financial statements whose financial statements reflectstotal assets of Rs.4019.16 crores as at 31 March 2019 and total revenues of Rs.4259.52crores and net cash flows amounting to Rs.(8.39) crores for the period from 20 May 2018 to31 March 2019.

These financial statements have been audited by an independent practitioner whosereport has been furnished to us by the management and our opinion on the standalonefinancial statements in so far as it relates to the amounts and disclosures included inrespecTof the Demerged Cement Division is based solely on the reporTof the independentpractitioner as adjusted for the accounting effects of the Scheme recorded by the Company(in particular the accounting effects of Ind AS 103 ‘Business Combinations') andother consequential adjustments which have been audited by us.

Our opinion on the standalone financial statements is not modified in respecTof theabove matter with respect to our reliance on the work done and the reporTof theindependent practitioner.

ReporTon Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors' Report) Order 2016 ("the Order")issued by the Central Government in terms of section 143 (11) of the Act we give in the"Annexure A" a statemenTon the matters specified in paragraphs 3 and 4 of theOrder to the extent applicable.

2. (A) 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 besTofour 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 standalone balance sheet the standalone statemenTof profit and loss (includingother comprehensive income) the standalone statemenTof changes in equity and thestandalone statemenTof cash flows dealt with by this Report are in agreement with thebooks of account;

d) In our opinion the aforesaid standalone financial statements comply with the Ind ASspecified under section 133 of the Act;

e) On the basis of the written representations received from the directors as on 31March 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;

f With respect to the adequacy of the internal financial controls with reference tostandalone financial statements) of the Company and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure B".

( With respect to the other matters to be included in the Auditors' Report inaccordance with Rule 11 of the Companies B) (Audit and Auditors) Rules 2014 in ouropinion and to the besTof our information and according to the explanations given to us:

i. The Company has disclosed the impacTof pending litigations as at 31 March 2020 onits financial position in its standalone financial statements - Refer note 33 to thestandalone financial statements;

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 47 to the standalone financial statements;

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company;

iv. The disclosures in the standalone financial statements regarding holdings as wellas dealings in specified bank notes during the period from 8 November 2016 to 30 December2016 have not been made in these standalone financial statements since they do not pertainto the financial year ended 31 March 2020.

(C) With respect to the matter to be included in the Auditors' Report under section197(16) of the Act:

In our opinion and according to the information and explanations given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under section 197(16) of the Act whichare required to be commented upon by us.

Annexure A to the Independent Auditors' ReporTon standalone financial statements

(Referred to in paragraph 1 under ‘ReporTon Other Legal and RegulatoryRequirements' section of our reporTof even date)

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

(b) The Company has a regular programme of physical verification of its fixed assets bywhich all fixed assets are verified in a phased manner over a period of three years. Inour opinion this periodicity of physical verification is reasonable haveing regard to thesize of the Company and the nature of its assets. Pursuant to the programme certain fixedassets were physically verified by the Management during the year. In our opinion andaccording to the information and explanations given to us no material discrepancies werenoticed on such verification.

(c) In our opinion and according to the information and explanations given to us and onthe basis of our examination of the records of the Company the title deeds of immovableproperties are held in the name of the Company except for the following which are not heldin the name of the Company:

Particulars Leasehold Land Freehold Land Buildings
Gross block as at 31 March 2020 (Rs. in Crore) 678.15 2496.22 393.91
Net block as at 31 March 2020 (Rs. in Crore) 584.05 2496.22 338.61
Total number of cases 422 2840 50

ii. T he inventory except for goods-in-transit and stocks lying with third partieshas been physically verified by the management at reasonable intervals during the year. Inour opinion the frequency of such verification is reasonable. For stocks lying with thirdparties at the year-end written confirmations have been obtained and in respecTofgoods-in-transit subsequent goods receipts have been verified or confirmations have beenobtained from the parties. The discrepancies noticed on verification between the physicalstocks and the book records have been properly dealt with in the books of account.

iii. In our opinion and according to the information and explanations given to us theCompany has not granted any loans secured or unsecured to companies firms LimitedLiability Partnerships or other parties covered in the register maintained under Section189 of the Act. Accordingly paragraph 3(iii) of the Order is not applicable to theCompany.

iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Act with respectto the loans given investments made guarantees given and security provided.

v. In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the publicduring the year in terms of theprovisions of Sections 73 to 76 or any other relevant provisions of the Act and the rulesframed there under. Accordingly paragraph 3(v) of the Order is not applicable to theCompany.

vi. W e have broadly reviewed the books of account maintained by the Company asspecified under Section 148(1) of the Act for maintenance of cost records in respecTofproducts manufactured by the Company 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 cost records with a view to determine whether they areaccurate or complete.

vii. (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted/accrued in the books ofaccount in respecTof undisputed statutory dues including Provident Fund Employees' StateInsurance Income-tax Goods and Service Tax Duty of Customs Cess and other materialstatutory dues have been regularly deposited during the year by the Company with theappropriate authorities.

According to the information and explanations given to us no undisputed amountspayable in respecTof Provident Fund Employees' State Insurance Income-tax Goods andService Tax Duty of Customs Cess and other material statutory dues were in arrears as at31 March 2020 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company details of dues of Income-tax Sales-taxService tax Duty of Customs Duty of Excise and Value added tax which have not beendeposited as at 31 March 2020 on accounTof disputes are given below:

Name of the Statute Nature of the Dues Forum where dispute is pending Period to which amount relates Amount* (Rs. in Crore)
(Assessment Year)
Sales Tax/ Value Added Tax (VAT) Sales Tax VAT Interest and Penalty Supreme Court 2000 to 2017 282.07
High Court 1988 to 2017 67.11
Tribunal(s) 1985 to 2016 142.42
Appellate Authorities 1990 to 2020 108.71
Assessing Officers 1997 to 2017 8.98
Customs Act 1962 Customs Duty Interest and Penalty High Court 2002 to 2006 50.96
Tribunal(s) 2000 to 2014 233.96
Appellate Authorities 2003 to 2015 0.14
Central Excise Act 1944 Excise Duty Interest and Penalty Supreme Court 1994 to 2018 106.18
High Court 1996 to 2016 39.39
Tribunal(s) 1994 to 2017 1295.31
Appellate Authorities 2002 to 2018 19.26
Finance Act 1994 Service Tax Interest and Penalty Supreme Court 2004 to 2008 21.50
High Court 2003 to 2014 12.97
Tribunal(s) 2005 to 2018 374.01
Appellate Authorities 2006 to 2018 17.97
Income Tax Act 1961 Income Tax Interest and Penalty High Court 2001 to 2016 5.89
Tribunal(s) 2014 to 2016 0.03

* neTof amounts paid under protest. viii. According to the information and explanationsgiven to us and based on the records of the Company the Company not defaulted in therepaymenTof loans or borrowings to financial institutions banks government and dues todebenture holders.

ix. According to the information and explanations given to us the term loans have beenapplied by the Company the year for the purposes for which they were obtained. The Companydid not raise money by way of initial publicoffer or further publicoffer (including debtinstruments) during the year.

x. According to the information and explanations given to us no material fraud by theCompany or on the Company by officers or employees has been noticed or reported during thecourse of our audit.

xi. According to the information and explanations give to us and based on ourexamination of the records of the Company has paid/provided for managerial remuneration inaccordance with the requisite approvals mandated by the provisions of Section 197 readwith 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. Accordingly paragraph 3(xii) of the Order is notapplicable to the Company.

xiii. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with Sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the standalone financial statements as required by theapplicable accounting standards.

xiv. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotmenTor private placemenTof shares or fully or partly convertible debentures duringthe year. Accordingly paragraph 3(xiv) of the Order is not applicable to the Company.

xv. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with them. Accordingly paragraph 3(xv)of the Order is not applicable to the Company.

xvi. According to the information and explanations given to us the Company is notrequired to be registered under Section 45 - IA of the Reserve Bank of India Act 1934.Accordingly paragraph 3(xvi) of the Order is not applicable to the Company.

Annexure B to the Independent Auditors' ReporTon the standalone financial statements

(Referred to in paragraph 2(A)(f) under ‘ReporTon Other Legal and RegulatoryRequirements' section of our reporTof even date) ReporTon the internal financial controlswith reference to the aforesaid standalone financial statements under Clause (i) ofsub-section 3 of section 143 of the Companies Act 2013

Opinion

We have audited the internal financial controls with reference to standalone financialstatements of UltraTech Cement Limited ("the Company") as of 31 March 2020 inconjunction with our audiTof the standalone financial statements of the Company for theyear ended on that date.

In our opinion the Company has in all material respects adequate internal financialcontrols with reference to standalone financial statements and such internal financialcontrols were operating effectively as at 31 March 2020 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 on AudiTof Internal Financial Controls Over Financial Reporting issued by theInstitute 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 for establishingand maintaining internal financial controls based on the internal financial controls withreference to standalone financial statements criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note.These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conducTof its business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013 (hereinafterreferred to as "the Act").

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to standalone financial statements based on our audit. Weconducted our audit in accordance with the Guidance Note and the Standards on Auditingprescribed under section 143(10) of the Act to the extent applicable to an audiTofinternal financial controls with reference to standalone financial statements. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls with reference to standalone financial statements were established andmaintained and whether such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to standalone financial statements andtheir operating effectiveness. Our audiTof internal financial controls with reference tostandalone financial statements included obtaining an understanding of such internalfinancial controls assessing the risk that a material weakness exists and testing andevaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgment including theassessmenTof the risks of material misstatemenTof the standalone financial statementswhether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audiTopinion on the Company's internal financial controls withreference to standalone financial statements.

Meaning of Internal Financial controls with Reference to Standalone FinancialStatements

A company's internal financial controls with reference to standalone financialstatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of standalone financial statements for externalpurposes in accordance with generally accepted accounting principles. A company's internalfinancial controls with reference to standalone financial statements include thosepolicies and procedures that (1) pertain to the maintenance of records that in reasonabledetail accurately and fairly reflect the transactions and dispositions of the assets ofthe company; (2) provide reasonable assurance that transactions are recorded as necessaryto permit preparation of standalone

financial statements in accordance with generally accepted accounting principles andthat receipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effecTon the standalonefinancial statements.

Inherent Limitations of Internal Financial controls with Reference to StandaloneFinancial Statements

Because of the inherent limitations of internal financial controls with reference tostandalone financial statements including the possibility of collusion or impropermanagemenToverride of controls material misstatements due to error or fraud may occur andnot be detected. Also projections of any evaluation of the internal financial controlswith reference to standalone financial statements to future periods are subject to therisk 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.

For B S R & Co. LLP For Khimji Kunverji & Co LLP
Chartered Accountants (Formerly Khimji Kunverji & Co.)
Firm's Registration No: 101248W/W-100022 Chartered Accountants
Firm's Registration No: 105146W/ W-100621
Vijay Mathur Ketan Vikamsey
Partner Partner
Membership No: 046476 Membership No: 044000
ICAI UDIN: 20046476AAAABX4053 ICAI UDIN: 20044000AAAAAF2045
Mumbai Mumbai
20 May 2020 20 May 2020