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United Breweries Ltd.

BSE: 532478 Sector: Consumer
NSE: UBL ISIN Code: INE686F01025
BSE 00:00 | 24 Jan 1522.50 -43.80
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NSE 00:00 | 24 Jan 1523.80 -42.55
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OPEN 1566.30
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VOLUME 8100
52-Week high 1793.65
52-Week low 1050.00
P/E 120.45
Mkt Cap.(Rs cr) 40,255
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 1566.30
CLOSE 1566.30
VOLUME 8100
52-Week high 1793.65
52-Week low 1050.00
P/E 120.45
Mkt Cap.(Rs cr) 40,255
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

United Breweries Ltd. (UBL) - Auditors Report

Company auditors report

To the Members of United Breweries Limited

Report on the Audit of the Standalone Ind AS Financial StatementsOpinion

We have audited the accompanying standalone Ind AS financial statementsof United Breweries Limited ("the Company") which comprise the StandaloneBalance Sheet as at March 31 2021 the Standalone Statement of Profit and Loss includingthe Standalone Statement of Other Comprehensive Income the Standalone Cash Flow Statementand the Standalone Statement of Changes in Equity for the year then ended and notes tothe standalone Ind AS financial statements including a summary of significant accountingpolicies and other explanatory information.

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone Ind AS financial statements give theinformation required by the Companies Act 2013 as amended ("the Act") in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2021 its profit including other comprehensive income its cash flows and the changesin equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone Ind AS financial statements inaccordance with the Standards on Auditing (SAs) as specified under section 143(10) of theAct. Our responsibilities under those Standards are further described in the 'Auditor'sResponsibilities for the Audit of the Standalone Ind AS Financial Statements' section ofour report. We are independent of the Company in accordance with the 'Code of Ethics'issued by the Institute of Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our audit opinion on the standalone Ind AS financial statements.

Emphasis of Matter

We draw attention to below mentioned notes to the accompanyingstandalone Ind AS financial statements:

(a) Note 44 which describes management's assessment of the impact ofCOVID-19 pandemic on the Company's operations and carrying values of assets as at March31 2021;

(b) Note 35(c) which more fully describes the uncertainty relating tothe future outcome of investigation by the Competition Commission of India("CCI"); and

(c) Note 43 which more fully describes the uncertainty relating to theoutcome of special leave petition filed by the Bihar State Government before theHonourable Supreme Court of India and the consequential impact thereof.

Our opinion is not modified in respect of aforesaid matters.

Key Audit Matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the standalone Ind AS financial statements forthe financial year ended March 31 2021. These matters were addressed in the context ofour audit of the standalone Ind AS financial statements as a whole and in forming ouropinion thereon and we do not provide a separate opinion on these matters. For eachmatter below our description of how our audit addressed the matter is provided in thatcontext.

We have determined the matters described below to be the key auditmatters to be communicated in our report. We have fulfilled the responsibilities describedin the Auditor's responsibilities for the audit of the standalone Ind AS financialstatements section of our report including in relation to these matters. Accordingly ouraudit included the performance of procedures designed to respond to our assessment of therisks of material misstatement of the

standalone Ind AS financial statements. The results of our auditprocedures including the procedures performed to address the matters below provide thebasis for our audit opinion on the accompanying standalone Ind AS financial statements.

Key audit matters How our audit addressed the key audit matter
Revenue from sale of products (as described in Note 2.1(d) (w) and 21 of the standalone Ind AS financial statements)
Revenue from sale of products is recognised when control of products has been transferred to the customer and there is no unfulfilled obligation that could affect the customer's acceptance of the products. Revenue from sale of products is measured at the fair value of the consideration received or receivable net of returns and allowances discounts and incentives. Our procedures included the following:
• Assessed the Company's revenue recognition accounting policy for sale of products including those relating to discounts and incentives.
• Understood evaluated and tested on sample basis the design and operating effectiveness of key internal controls over recognition and measurement of revenue discounts and incentives.
• Performed test of details on a sample basis and inspected the underlying accounting documents relating to sales and accrual of discounts and incentives.
At year end amounts of discounts and incentives that have been incurred and not yet issued to customers are estimated and accrued. Significant judgement is required in estimating accruals relating to discounts and incentives recognised in relation to sales made during the year.
• Tested on a sample basis sales transactions near year end date as well as credit notes issued to customers after the year end date.
• Obtained an understanding of and evaluated underlying data used in management assessment of estimates relating to discounts and incentives.
• Performed analytical procedures on revenue discounts and incentives.
• Assessed the disclosures in the standalone Ind AS financial statements in respect of revenue discounts and incentives for compliance with disclosure requirements.
Provision for trade receivables (as described in Note 2.1(w) 10 and 40(b) of the standalone Ind AS financial statements)
Trade receivable balances represent significant portion of the total assets as at March 31 2021. Trade receivables include dues from state government corporations distributors retailers and contract manufacturing units. The Company records expected credit loss for unsecured trade receivables based on management estimates. Our procedures included the following:
• Understood evaluated and tested on a sample basis the design and operating effectiveness of internal controls over trade receivables.
• Performed audit procedures on existence of trade receivables which included reading and comparing balance confirmations with books of account testing subsequent receipts and testing sales transactions on a sample basis.
Timing of collection of dues from customers may differ from the contractual credit period. Significant judgment is involved in management estimates of the amounts unlikely to be ultimately collected.
• Evaluated the assumptions used by management to calculate the expected credit loss for trade receivables through audit procedures which included analysis of ageing past trend of bad debts write-off and understanding management's estimate of possible impact arising from the COVID-19 pandemic.
• Assessed the disclosures in the standalone Ind AS financial statements for compliance with disclosure requirements.
Tax contingencies and provisions
(as described in Note 2.1(w) 17 and 35(a) of the standalone Ind AS financial statements)
The Company has received income tax demand orders and notices relating to transfer pricing disallowance of certain expenses etc. and has also received indirect tax demand orders and notices which are under litigation. Our procedures included the following:
• Obtained an understanding of the Company's process with respect to completeness and recognition of tax contingencies and provisions.
• Read the confirmations on sample basis from the Company's external legal counsel on tax litigations and evaluated the independence objectivity and competency of the Company's specialists involved.
The Company is contesting these demands and has made provision where the outflow of resources embodying economic benefits is considered to be probable.
• Read relevant tax laws and discussed with the management to understand the underlying matters in the demand orders / notices and basis for management judgement and estimates.
Significant judgement and estimates are required to assess uncertain income tax/other indirect tax positions and impact of these litigations on the financial position results of operations and cash flows.
• Included tax specialists in our team to perform an evaluation of assumptions used by the management and relevant judgements passed by the authorities including the interpretation of the relevant tax laws.
• Assessed the related disclosures in the standalone Ind AS financial statements for compliance with disclosure requirements.

Other Information

The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the director'sreport and the corporate governance report but does not include the standalone Ind ASfinancial statements and our auditor's report thereon.

Our opinion on the standalone Ind AS financial statements does notcover the other information and we do not express any form of assurance conclusionthereon.

In connection with our audit of the standalone Ind AS financialstatements our responsibility is to read the other information and in doing so considerwhether such other information is materially inconsistent with the financial statements orour knowledge obtained in the audit or otherwise appears to be materially misstated. Ifbased on the work we have performed we conclude that there is a material misstatement ofthis other information we are required to report that fact. We have nothing to report inthis regard.

Responsibilities of Management and Those Charged with Governance forthe Standalone Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these standalone Ind ASfinancial statements that give a true and fair view of the financial position financialperformance including other comprehensive income cash flows and changes in equity of theCompany in accordance with the accounting principles generally accepted in Indiaincluding the Indian Accounting Standards (Ind AS) specified under section 133 of the Actread with the Companies (Indian Accounting Standards) Rules 2015 as amended. 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; andthe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone Ind AS financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone Ind AS financial statements management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concern

basis of accounting unless management either intends to liquidate theCompany or to cease operations or has no realistic alternative but to do so.

Those Charged with Governance are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibilities for the Audit of the Standalone Ind ASFinancial Statements

Our objectives are to obtain reasonable assurance about whether thestandalone Ind AS financial statements as a whole are free from material misstatementwhether due 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 Ind AS financialstatements.

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

• Identify and assess the risks of material misstatement of thestandalone Ind AS financial statements whether due to fraud or error design and performaudit procedures responsive to those risks and obtain audit evidence that is sufficientand appropriate 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 fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof 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 financialstatements in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.

• Evaluate the overall presentation structure and content of thestandalone Ind AS financial statements including the disclosures and whether thestandalone Ind AS financial statements represent the underlying transactions and events ina manner that achieves fair presentation.

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 standalone IndAS financial statements for the financial year ended March 312021 and are therefore thekey audit matters. We describe these matters in our auditor's report unless law orregulation precludes public disclosure about the matter or when in extremely rarecircumstances we determine that a matter should not be communicated in our report becausethe adverse consequences of doing so would reasonably be expected to outweigh the publicinterest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016("the Order") issued by the Central Government of India in terms of sub-section(11) of section 143 of the Act we give in the "Annexure 1" a statement on thematters specified in paragraphs 3 and 4 of the Order.

2. As required by section 143(3) of the Act we report that:

(a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit;

(b) In our opinion proper books of account as required by law havebeen kept by the Company so far as it appears from our examination of those books;

(c) The Standalone Balance Sheet the Standalone Statement of Profitand Loss including the Standalone Statement of Other Comprehensive Income the StandaloneCash Flow Statement and the Standalone Statement of Changes in Equity dealt with by thisreport are in agreement with the books of account;

(d) In our opinion the aforesaid standalone Ind AS financialstatements comply with the Accounting Standards specified under section 133 of the Actread with Companies (Indian Accounting Standards) Rules 2015 as amended;

(e) The matter described in paragraph (b) of Emphasis of Matterparagraph above in our opinion may have an adverse effect on the functioning of theCompany;

(f) On the basis of the written representations received from thedirectors as on March 31 2021 taken on record by the Board of Directors none of thedirectors is disqualified as on March 31 2021 from being appointed as a director in termsof section 164(2) of the Act;

(g) With respect to the adequacy of the internal financial controlsover financial reporting of the Company with reference to these standalone Ind ASfinancial statements and the operating effectiveness of such controls refer to ourseparate Report in "Annexure 2" to this report;

(h) In our opinion the managerial remuneration for the year endedMarch 312021 has been paid / provided by the Company to its whole-time directors inaccordance with the provisions of section 197 read with Schedule V to the Act.Remuneration amounting to Rs. 285 Lakhs for the non-executive directors has been providedas per limits under Schedule V of the Act and is pending approval of the shareholders; and

(i) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 asamended in our opinion and to the best of our information and according to theexplanations given to us:

i. The Company has disclosed the impact of pending litigations on itsfinancial position in its standalone Ind AS financial statements - Refer Note 17 35(a)35(c) and 43 to the standalone Ind AS financial statements;

ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses; and

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

For S.R. Batliboi & Associates LLP Chartered Accountants

ICAI Firm Registration Number: 101049W/E300004

per Aditya Vikram Bhauwala Partner

Membership Number: 208382

Unique Document Identification Number (UDIN): 21208382AAAABH5619

Place of signature: Bengaluru Date: April 27 2021

ANNEXURE 1 TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THESTANDALONE IND AS

FINANCIAL STATEMENTS OF UNITED BREWERIES LIMITED

Statement on the matters specified in paragraphs 3 and 4 of theCompanies (Auditor's report) Order 2016

("the Order")

(i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation

of property plant and equipment.

(b) Property plant and equipment have been physically verified by themanagement during the year and no material discrepancies were identified on suchverification.

(c) According to the information and explanations given by themanagement and confirmation from banks relating to title deeds of immovable propertiesmortgaged with the banks (refer Note 15 to the accompanying standalone Ind AS financialstatements for details) for securing borrowings raised by the Company the title deeds ofimmovable properties included in property plant and equipment are held in the name of theCompany except for 1 immovable property of 9.04 acres (forming part of land parcel of23.87 acres with gross book value of Rs. 211 Lakhs) where registration of title deed ispending 3 immovable properties aggregating to 0.54 acres (forming part of land parcel of184.96 acres with gross book value of Rs. 11724 Lakhs) for which title deeds are underdispute and pending resolution at the Courts as at March 31 2021; and 3 immovableproperties (including leasehold land) aggregating to 106.80 acres (with gross book valueof Rs. 1909 Lakhs) for which title deeds are held in the name of erstwhile mergedentities.

(ii) The management has conducted physical verification of inventory atreasonable intervals during the year and no material discrepancies were noticed on suchphysical verification. Inventories lying with outside parties have been confirmed by themas at March 31 2021 and no material discrepancies were noticed in respect of suchconfirmations.

(iii) 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 Companies Act 2013 ("the Act"). Accordingly the provisions ofclause 3(iii)(a) (b) and (c) of the Order are not applicable to the Company and hence notcommented upon.

(iv) In our opinion and according to the information and explanationsgiven to us provisions of section 186 of the Act in respect of investments made by theCompany have been complied with. In our opinion and according to the information andexplanations given to us there are no loans guarantees and securities given in respectof which the provisions of section 185 and 186 of the Act are applicable and hence notcommented upon.

(v) The Company has not accepted any deposits within the meaning ofsections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules 2014 (asamended). Accordingly the provisions of clause 3(v) of the Order are not applicable.

(vi) To the best of our knowledge and as explained the CentralGovernment has not specified the maintenance of cost records under section 148(1) of theAct for the products/services of the Company.

(vii) (a) Undisputed statutory dues including provident fundemployees' state insurance income-tax sales-tax goods

and services tax duty of customs duty of excise value added taxcess and other statutory dues have generally been regularly deposited with the appropriateauthorities.

(b) According to the information and explanations given to us and auditprocedures performed by us no undisputed amounts payable in respect of provident fundemployees' state insurance income-tax sales-tax service tax goods and services taxduty of customs duty of excise value added tax cess and other statutory dues wereoutstanding at the year end for a period of more than six months from the date theybecame payable.

(c) According to the records of the Company the dues outstanding ofincome tax sales-tax service tax goods and services tax duty of customs duty ofexcise value added tax and cess on account of any dispute are as follows:

Name of the statute Nature of the dues Amount (including interest and penalty) (Rs. in Lakhs) Payment under protest (Rs. in Lakhs) Period to which the amount relates Forum where the dispute is pending
The Income Tax Act 1961 Income tax / tax deducted at source 24828 7679 FY 2001-02 to 2014-15 Income Tax Appellate Tribunal
8629 - FY 2015-16 Dispute Resolution Panel
8578 1567 FY 2002-03 to 2011-12 Commissioner of Income Tax (Appeals)
3599 458 FY 2001-02 to 2009-10 High Court of Madras
2745 664 FY 2003-04 to 2008-09 High Court of Karnataka
69 46 FY 2009-10 High Court of Andhra Pradesh and Telangana
20 - FY 2007-08 to 2017-18 Commissioner of Income Tax (TDS)
The Finance Act 1994 Service tax 2192 96 2009-10 to 2011-12 Commissioner of Customs and Central Excise Aurangabad
401 - 2008-09 to 2010-11 Customs Excise and Service Tax Appellate Tribunal
6 - 2014-15 The Commissioner GST & Central Excise Bhubaneswar
The Central Excise Act 1944 Excise duty/ disallowance of cenvat credit 82 2010-11 to 2015-16 Commissioner of Customs Central Excise & Service tax Appellate Tribunal
67 9 2005-06 to 2007-08 2013-14 and 2014-15 Customs Excise and Service Tax Appellate Tribunal
49 - 2014-15 and 2015-16 Commissioner (Appeals) Central Excise
32 2 2017-18 Assistant Commissioner of Central Excise Sadashivpet Division
28 2009-10 to 2015-16 Commissioner of Customs Central Excise & Service tax (Appeals)
18 - 2016-17 Assistant Commissioner Appeals Jaipur
11 1 2015-16 and 2017-18 Assistant Commissioner of Goods and Services Tax (Appeals)
1 - 2007-08 Commissioner (Appeals) Central Excise Chandigarh
Name of the statute Nature of the dues Amount (including interest and penalty) (Rs. in Lakhs) Payment under protest (Rs. in Lakhs) Period to which the amount relates Forum where the dispute is pending
State Excise (various statutes) Excise duty Storage and privilege fee etc. 10929 2015-16 Deputy Commissioner (Excise) Bangalore Rural District Beerasandra
2079 2079 2013-14 2017-18 and 2020-21 High Court of Rajasthan
619 613 2019-20 Excise Commissioner Aligarh Uttar Pradesh
350 - 2007-08 to 2011-12 High Court of Bombay
218 150 1999-00 to 2005-06 High Court of Karnataka
56 - 2015-16 Deputy Commissioner Guwahati
43 13 1988-89 High Court of Calcutta
38 38 2011-12 to 2015-16 High Court of Bombay at Goa
19 5 2008-09 to 2012-13 High Court of Madhya Pradesh
3 - 2000-01 to 2003-04 Excise Commissioner Karnataka
Sales Tax (various statutes) Sales tax/ Value added tax/ Entry tax 5890 2400 2001-02 to 2013-14 Rajasthan Tax Board Ajmer
645 535 2008-09 2012-13 and 2013-14 Joint Commissioner of Commercial Taxes (Appeal) Maharashtra
579 24 2012-13 The Appeal Authority Commercial Taxes Alwar
477 48 2014-15 and 2015-16 Assistant Commercial Tax Officer Ponda
447 - 2006-07 and 2007-08 The West Bengal Sales Tax Appellate and Revisional Board
314 - 2017-18 Joint Commissioner of Sales tax West Bengal
186 - 2016-17 Joint Commissioner of Sales Tax West Bengal
184 172 2009-10 2010-11 and 2015-16 Joint Commissioner of Commercial Taxes (Appeal) Patna
166 2 2014-15 and 2015-16 Additional Commissioner of Sales Tax West Bengal
Name of the statute Nature of the dues Amount (including interest and penalty) (Rs. in Lakhs) Payment under protest (Rs. in Lakhs) Period to which the amount relates Forum where the dispute is pending
Sales Tax (various statutes) Sales tax/ Value added tax/ Entry tax 63 2002-03 Jt. Excise and Taxation Commissioner (Appeals) Faridabad
58 58 2007-08 to 2014-15 Additional Commissioner of Commercial tax Tamil Nadu
26 7 2011-12 and 2013-14 Commissioner of Commercial Taxes Bihar
17 1 2011-12 to 2016-17 Deputy Commissioner Appeals Alwar
15 8 2003-04 Maharashtra Sales Tax Tribunal
13 1 2008-09 and 2011-12 Commercial Taxes Tribunal Bihar
7 2013-14 and 2014-15 Additional Commissioner of Commercial taxes (Appeal) Berhampur

(viii) In our opinion and according to the information and explanationsgiven by the management the Company has not defaulted in repayment of loans or borrowingsto financial institution or banks. The Company did not have loans or borrowings fromgovernment or any outstanding dues in respect of debenture holders during the year.

(ix) In our opinion and according to information and explanations givenby the management and audit procedures performed by us monies raised by the Company byway of term loans were applied for the purposes for which loans were obtained. The Companyhas not raised any money by way of initial public offer or further public offer (includingdebt instruments) and hence not commented upon.

(x) Based upon the audit procedures performed for the purpose ofreporting the true and fair view of the standalone Ind AS financial statements andaccording to the information and explanations given by the management we report that nofraud by the Company or no material fraud on the Company by the officers and employees ofthe Company has been noticed or reported during the year.

(xi) According to the information and explanations given by themanagement and audit procedures performed by us the managerial remuneration has been paid/ provided to whole-time directors in accordance with the requisite approvals mandated bythe provisions of section 197 read with Schedule V to the Act. Remuneration amounting toRs. 285 Lakhs for the non-executive directors has been provided as per limits underSchedule V of the Act and is pending approval of the shareholders.

(xii) In our opinion the Company is not a nidhi company. Thereforethe provisions of clause 3(xii) of the Order are not applicable to the Company and hencenot commented upon.

(xiii) According to the information and explanations given by themanagement and audit procedures performed by us transactions with the related parties arein compliance with section 177 and 188 of the Act where applicable and the details havebeen disclosed in the notes to the standalone Ind AS financial statements as required bythe applicable accounting standards.

(xiv) According to the information and explanations given to us and onan overall examination of the balance sheet the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year under review and hence reporting requirements under clause 3(xiv) are notapplicable to the Company and not commented upon.

(xv) According to the information and explanations given by themanagement the Company has not entered into any non-cash transactions with directors orpersons connected with him as referred to in section 192 of the Act.

(xvi) According to the information and explanations given to us theprovisions of section 45-IA of the Reserve Bank of India Act 1934 are not applicable tothe Company.

For S.R. Batliboi & Associates LLP

Chartered Accountants

ICAI Firm Registration Number: 101049W/E300004

per Aditya Vikram Bhauwala

Partner

Membership Number: 208382

Unique Document Identification Number (UDIN): 21208382AAAABH5619

Place of signature: Bengaluru

Date: April 27 2021

ANNEXURE 2 TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THESTANDALONE IND AS FINANCIAL STATEMENTS OF UNITED BREWERIES LIMITED

Report on the Internal Financial Controls under clause (i) ofsub-section 3 of section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financialreporting of United Breweries Limited ("the Company") as of March 31 2021 inconjunction with our audit of the standalone Ind AS financial statements of the Companyfor the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing andmaintaining internal financial controls based on the internal controls over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") issued by the Institute of CharteredAccountants of India. 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 to theCompany'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.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting with reference to these standalone Ind ASfinancial statements based on our audit. We conducted our audit in accordance with theGuidance Note and the Standards on Auditing as specified under section 143(10) of the Actto the extent applicable to an audit of internal financial controls and both issued bythe Institute of Chartered Accountants of India. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting with reference to these standalone Ind AS financial statements was establishedand maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting withreference to these standalone Ind AS financial statements and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reporting withreference to these standalone Ind AS financial statements assessing the risk that amaterial weakness exists and testing and evaluating the design and operatingeffectiveness of internal controls based on the assessed risk. The procedures selecteddepend on the auditor's judgement including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the internal financial controlsover financial reporting with reference to these standalone Ind AS financial statements.

Meaning of Internal Financial Controls Over Financial Reporting withReference to these Standalone Ind AS Financial Statements

A company's internal financial controls over financial reporting withreference to these standalone Ind AS financial statements is a process designed to providereasonable assurance regarding the reliability of financial reporting and the preparationof financial statements for external purposes in accordance with generally acceptedaccounting principles. A company's internal financial controls over financial reportingwith reference to these standalone Ind AS financial statements includes 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 thecompany; 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 Over FinancialReporting with Reference to these Standalone Ind AS Financial Statements

Because of the inherent limitations of internal financial controls overfinancial reporting with reference to these standalone Ind AS financial statementsincluding the possibility of collusion or improper management override of controlsmaterial misstatements due to error or fraud may occur and not be detected. Alsoprojections of any evaluation of the internal financial controls over financial reportingwith reference to these standalone Ind AS financial statements to future periods aresubject to the risk that the internal financial controls over financial reporting withreference to these standalone Ind AS financial statements may become inadequate because ofchanges in conditions or that the degree of compliance with the policies or proceduresmay deteriorate.

Opinion

In our opinion the Company has in all material respects adequateinternal financial controls over financial reporting with reference to these standaloneInd AS financial statements and such internal financial controls over financial reportingwith reference to these standalone Ind AS financial statements were operating effectivelyas at March 31 2021 based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note issued by the Institute of Chartered Accountants of India.

For S.R. Batliboi & Associates LLP Chartered Accountants

ICAI Firm Registration Number: 101049W/E300004

per Aditya Vikram Bhauwala Partner

Membership Number: 208382

Unique Document Identification

Number (UDIN): 21208382AAAABH5619

Place of signature: Bengaluru

Date: April 27 2021

.