You are here » Home » Companies » Company Overview » WABCO India Ltd

WABCO India Ltd.

BSE: 533023 Sector: Auto
NSE: WABCOINDIA ISIN Code: INE342J01019
BSE 00:00 | 29 Jul 7202.45 25.85
(0.36%)
OPEN

7200.00

HIGH

7500.00

LOW

7136.35

NSE 00:00 | 29 Jul 7202.00 25.95
(0.36%)
OPEN

7220.00

HIGH

7455.00

LOW

7115.20

OPEN 7200.00
PREVIOUS CLOSE 7176.60
VOLUME 1284
52-Week high 7870.45
52-Week low 4770.15
P/E 131.55
Mkt Cap.(Rs cr) 13,656
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 7200.00
CLOSE 7176.60
VOLUME 1284
52-Week high 7870.45
52-Week low 4770.15
P/E 131.55
Mkt Cap.(Rs cr) 13,656
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

WABCO India Ltd. (WABCOINDIA) - Auditors Report

Company auditors report

To

The Members of WABCO INDIA LIMITED

Report on the Audit of the Financial Statements

Opinion

We have audited the financial statements of WABCO India Limited ("theCompany") which comprise the balance sheet as at March 31 2020 and the statementof profit and loss (including other comprehensive income) statement of changes in equityand statement of cash flows for the year then ended and notes to the financialstatements including a summary of the significant accounting policies and otherexplanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by theCompanies Act 2013 ("Act") in the manner so required and give a true and fairview in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 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 Audit of the Financial Statementssection of our report. We are independent of the Company in accordance with the Code ofEthics 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 opinion on the financial statements

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.

Description of Key Audit Matter

Revenue recognition - See note 2.2(c) and 18 to the financial statements

The key audit matter How the matter was addressed in our audit
The Company's revenue is derived primarily from sale of goods. Revenue from the sale of goods is recognised upon the transfer of control of the goods to the customer. 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 uses a variety of shipment terms across its operating markets and this has an impact on the timing of revenue recognition. There is a risk that revenue could be recognised at a time which is different from transfer of control especially for sales transactions occurring on and around the year end. • Assessed the appropriateness of the Company's revenue recognition accounting policies in line with Ind AS 115 ("Revenue from Contracts with Customers") including adequacy of disclosures.
Therefore ascertainment of timing of the revenue recognition has been identified as a key audit matter. • Obtained an understanding of the Company's sales process including design and implementation of key controls and tested the effectiveness of such controls in relation to the timing of revenue recognition on a sample basis.
• Performed test of details of the sales transactions on a sample basis to test that the revenues and trade receivables are recorded appropriately taking into consideration the terms and conditions of the customer orders including the shipping terms.
• Testing on a sample basis whether revenue transactions near to the reporting date have been recognised in the appropriate period by verifying the transactions selected with relevant underlying documentation (customer order transporter document customer portal etc).
• Performing analytical procedures on current year revenue based on monthly trends and where appropriate conducting further enquiries and to identify unusual transactions.
• Obtained independent balance confirmations from the Company's customers on sample basis.

Significant judgments and estimates relating to allowance for obsolescence of slow andnon-moving inventory See note 2(e) and 7 to the financial statements

Key audit matters How our audit addressed the key audit matter
The Company holds inventory at various locations including plant warehouses and subcontractor locations. 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:
Inventory includes raw materials stores and spares work in progress and finished goods. The value of inventory as on March 31 2020 is INR 11257.47 lakhs after considering allowance for obsolescence of slow and non- moving inventory of INR 928.89 lakhs.
• Assessing the appropriateness of the accounting policies for inventories and its compliances with applicable accounting standards.
Management assesses the level of allowance for inventory obsolescence required at each reporting date after considering changes in market demand due to changing technology and historical as well as expected movements. • Evaluating the design of key internal financial controls and operating effectiveness of the relevant key controls with respect to allowance for slow and non-moving inventory.
This involves significant assumptions and estimations in determining allowance for obsolescence of slow and non-moving inventory and thus we have identified allowance for obsolescence of slow and non-moving inventory as a key audit matter. • Tested whether the basis of computation of allowance for slow and non-moving inventory obsolescence at the reporting date is appropriate by assessing the methodology and assumptions adopted by the management supported by analysis of historical data and future projections (i.e. annual operating plan).
• Tested completeness accuracy and validity of the data used in the inventory allowance calculations for slow-moving and non-moving inventory.

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 financial statements and our auditors' reportthereon.

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

In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact. We have nothing to report in this regard.

Management's and Board of Directors' Responsibility for the Financial Statements

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 financial statementsthat give a true and fair view of the state of affairs profit/loss 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 the accuracy and completeness of the accounting records relevantto the preparation and presentation of the financial statements that give a true and fairview and are free from material misstatement whether due to fraud or error.

In preparing the financial statements management and Board of Directors areresponsible 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 realistic alternative but to do so.

The Board of Directors is also responsible for overseeing the Company's financialreporting process.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.

As part of 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 misstatement of the 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 todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Act we are also responsible for expressing our opinion on whether the company hasadequate internal financial controls with reference to financial statements in place andthe operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures in the financial statements made byManagement and Board of Directors.

• Conclude on the appropriateness of 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 significantdoubt on 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 financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

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

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

Other matters

The financial statements of the Company for the year ended March 31 2019 were auditedby another auditor who expressed an unmodified opinion on those statements on May 252019. Our opinion is not modified in respect to this matter.

Report on 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 statement on the matters specified in paragraphs 3 and 4 of theOrder to the extent applicable.

(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 bestof our knowledge and belief were necessary for the purposes of our audit.

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

c) The balance sheet the statement of profit and loss (including other comprehensiveincome) the statement of changes in equity and the statement of cash flows dealt with bythis Report are in agreement with the books of account.

d) In our opinion the aforesaid financial statements comply with the Ind AS specifiedunder section 133 of the Act.

e) On the basis of the written representations received from the directors as on March31 2020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2020 from being appointed as a director in terms of Section 164(2) of theAct.

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

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

i. The Company has disclosed the impact of pending litigations as at March 31 2020 onits financial position in its financial statements - Refer Note 35(A) to the financialstatements;

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

iii. During the year there has been a delay of four days with respect to transferringof funds required to be transferred to the Investor Education and Protection Fund by theCompany.

iv. The disclosures in the financial statements regarding holdings as well as dealingsin specified bank notes during the period from November 8 2016 to December 30 2016 havenot been made in these financial statements since they do not pertain to the financialyear ended March 31 2020.

(C) With respect to the matter to be included in the Auditors' Report under Section197(16):

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) which arerequired to be commented upon by us.

For B S R & Co. LLP
Chartered Accountants
Firm's Registration No: 101248W/W-100022
K RAGHURAM
Partner
Place : Chennai Membership No: 211171
Date : May 22 2020 ICAI UDIN: 20211171AAAABD3087

Annexure A to the Independent Auditor's Report to the members of WABCO India Limitedfor the year ended March 31 2020

(Referred to in paragraph 1(A) under 'Report on Other Legal and RegulatoryRequirements' section of our report of even date)

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of property plant and equipment.

(b) The Company has a regular programme of physical verification of its property plantand equipment by which property plant and equipment are verified once in three years.Pursuant to such program a portion of property plant and equipment has been physicallyverified by the management during the year and no material discrepancies were noticed onsuch verification.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.

(ii) The inventory excluding goods in transit has been physically verified by themanagement during the year.

In our opinion the frequency of verification is reasonable. The discrepancies noticedon verification between physical stock and book records were not material.

(iii) The Company has not granted any loan secured or unsecured to companies firmslimited liability partnerships or other parties covered in the register required underSection 189 of the Companies Act 2013. Accordingly paragraph 3(iii) of the Order is notapplicable.

(iv) The Company does not have any loan investment guarantees and security whichrequires compliance under Section 185 and 186 of the Act. Accordingly paragraph 3(iv) ofthe Order is not applicable.

(v) The Company has not accepted any deposits as mentioned in the directives issued byReserve Bank of India and the provisions of Section 73 to 76 or any other relevantprovisions of the Act and the rules framed thereunder. Accordingly paragraph 3(v) of theOrder is not applicable.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules prescribed by the Central Government for the maintenance of cost recordsunder Section 148(1) of the Act in respect of products manufactured and are of the opinionthat prima facie the prescribed accounts and records have been made and maintained.

(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 respect of undisputed statutory dues including provident fund employees' stateinsurance income tax duty of customs goods and services tax cess and other materialstatutory dues have generally been regularly deposited during the year by the Company withthe appropriate authorities. As explained to us the Company do not have dues on accountof sales tax service tax duty of excise and value added tax.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income tax duty ofcustoms goods and services tax cess and other material statutory dues were in arrears asat March 31 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 there are no dues ofincome tax sales tax service tax duty of customs duty of excise value added tax andgoods and services tax which have not been deposited with the appropriate authorities onaccount of a dispute other than those mentioned below:

Name of the statute Nature of dues Amount Period to which the amount rates Forum where dispute is pending
(INR in lakhs)*
Income Tax Act 1961 Income taxes 38.26 2012-13 Income Tax Appellate Tribunal Chennai
Income Tax Act 1961 Income taxes 35.10 2012-13 Deputy Commissioner of Income Tax
Income Tax Act 1961 Income taxes 438.13 2012-13 and 2013-14 Commissioner of Income tax (Appeals) Chennai
Income Tax Act 1961 Income taxes 990.89 2011-12 2013-14 and 2015-16 Income Tax Appellate Tribunal Chennai
Central Excise Act 1944 Excise duty / CENVAT 52.15 2012-13 to 2015-16 Customs Excise and Service Tax Appellate Tribunal Chennai
The Finance Act 1994 Service tax 0.88 2008-09 Commissioner of Central Excise (Appeals) Chennai
The Central Sales Tax Act 1956 Sales tax 52.90 2008-09 2009-10 2016-17 and 2017-18 Assistant Commissioner (Commercial Taxes) Chennai
Tamil Nadu Value Added Tax Act 2006* Value added taxes 44921.18 2009-10 to 2015-16 High court of Madras
Central Excise Act 1944 Excise duty / CENVAT 46.20 2016-17 & 2017-18 Assistant Commissioner of GST and Central Excise Chennai
Central Excise Act 1944 Excise duty / CENVAT 160.79 2015-16 and 2016-17 Joint Commissioner of Central Excise Chennai
The Central Sales Tax Act 1956 Sales tax 22.53 2014-15 Assistant Commissioner (Commercial Taxes) Uttar Pradesh

* net of amount paid under protest

(viii) The Company did not have outstanding dues to any financial institutions bankdebenture holders and government during the year. Accordingly paragraph 3(viii) of theOrder is not applicable.

(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) or term loans during the year.

(x) According to the information and explanations given to us no material fraud by theCompany or no material fraud on the Company by its officers or employees has been noticedor reported during the course of our audit.

(xi) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has paid / provided for managerialremuneration in accordance with section 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a nidhi company.

Accordingly paragraph 3(xii) of the Order is not applicable.

(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. The details of suchrelated party transactions have been disclosed in the financial statements as requiredunder applicable 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 preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year under review. Accordingly paragraph 3(xiv) of the Order is not applicable.

(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 him.

Accordingly paragraph 3(xv) of the Order is not applicable.

(xvi) The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934. Accordingly paragraph 3(xvi) of the Order is not applicable.

For B S R & Co. LLP
Chartered Accountants
Firm's Registration No: 101248W/W-100022
K RAGHURAM
Partner
Place : Chennai Membership No: 211171
Date : May 22 2020 ICAI UDIN: 20211171AAAABD3087

Annexure B to the Independent Auditors' report on the financial statements of WABCOIndia Limited for the year ended March 31 2020

Report on the internal financial controls with reference to the aforesaid financialstatements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013

(Referred to in paragraph 1(A)(f) under 'Report on Other Legal and RegulatoryRequirements' section of our report of even date)

Opinion

We have audited the internal financial controls with reference to financial statementsof WABCO India Limited ("the Company") as of March 31 2020 in conjunction withour audit of the financial statements of the Company for the year ended on that date.

In our opinion the Company has in all material respects adequate internal financialcontrols with reference to financial statements and such internal financial controls wereoperating effectively as at March 31 2020 based on the internal financial controls withreference to financial statements criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants 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 financial statements criteria established by the Company considering theessential components of internal control stated in the Guidance Note. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013 (hereinafter referred to as"the Act").

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to financial statements based on our audit. We conducted our auditin accordance with the Guidance Note and the Standards on Auditing prescribed underSection 143(10) of the Act to the extent applicable to an audit of internal financialcontrols with reference to 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 tofinancial statements were established and maintained and whether such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to financial statements and their operatingeffectiveness. Our audit of internal financial controls with reference to financialstatements included obtaining an understanding of such internal financial controlsassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgement including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

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

Meaning of Internal Financial controls with Reference to Financial Statements

A company's internal financial controls with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial controlswith reference to financial statements include those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.

Inherent Limitations of Internal Financial controls with Reference to FinancialStatements

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

For B S R & Co. LLP
Chartered Accountants
Firm's Registration No: 101248W/W-100022
K RAGHURAM
Partner
Place : Chennai Membership No: 211171
Date : May 22 2020 ICAI UDIN: 20211171AAAABD3087

.