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Wockhardt Ltd.

BSE: 532300 Sector: Health care
NSE: WOCKPHARMA ISIN Code: INE049B01025
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OPEN 435.00
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VOLUME 67676
52-Week high 804.50
52-Week low 394.00
P/E
Mkt Cap.(Rs cr) 4,888
Buy Price 0.00
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Sell Price 0.00
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OPEN 435.00
CLOSE 431.10
VOLUME 67676
52-Week high 804.50
52-Week low 394.00
P/E
Mkt Cap.(Rs cr) 4,888
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Wockhardt Ltd. (WOCKPHARMA) - Auditors Report

Company auditors report

To the Members of Wockhardt Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the standalone financial statements of Wockhardt Limited ("theCompany") which comprise the standalone balance sheet as at 31 March 2021 and thestandalone statement of profit and loss (including other comprehensive income) standalonestatement of changes in equity and standalone statement of cash flows for the year thenended and notes to the standalone financial statements including a summary of thesignificant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 ("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 2021 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 Standalone FinancialStatements section of our report. We are independent of 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 audit of 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.

Key Audit Matters

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

Revenue recognition
The Key Audit Matter How the matter was addressed in our audit
The Company recognises revenue from sale of goods when control over the goods is transferred to the customer. Our audit procedures included the following:
The actual point in time when revenue is recognised varies depending on the specific terms and conditions of the sale contracts entered into with customers • We have assessed the Company's accounting policies relating to revenue recognition by comparing with applicable accounting standards.
Revenue is a key performance indicator of the Company and there is risk of overstatement of revenue due to fraud resulting from pressure to achieve targets earning expectations or incentive schemes linked to performance. • We have evaluated the design implementation and operating effectiveness of the Company's key internal control over revenue recognition.
Given the risk of overstatement of revenue due to fraud this is a key audit matter. Refer note 3(j) of accounting policy and note 41 in standalone financial statements. • We have examined the samples selected using statistical sampling of revenue recorded during the year with the underlying documentation.
• We have performed cut off procedures by selecting samples using statistical sampling of revenue recorded as at the period end.
• We have examined the manual journals posted to revenue at period end to identify unusual or irregular items.
• We have assessed the adequacy of the disclosures made in respect of revenue from sale of goods.
Assessment of recoverability of carrying value of certain Property Plant and Equipment and Capital Work in progress
Certain property plant and equipment and capital work in progress of the Company is affected by lower capacity utilization mainly due to regulatory alert from U.S. Our audit procedures included the following:
Food and Drug Administration ("US FDA") and are currently not being used for alternate purposes. • We have assessed the Company's accounting policies relating to impairment by comparing with applicable accounting standards.
The Company's investment in these facilities was made considering market feasibility and potential of existing / future products. • We have inquired the progress made on remediation work with key managerial personnel.
As at 31 March 2021 carrying value of such Property Plant and Equipment and Capital Work in Progress amounts to Rs.186.47 crores and Rs.285.81 crores respectively. • We have verified the reports of physical verification of property plant and equipment and capital work in progress (those assets affected by alerts from US FDA) by the Company including those done by external experts
The Company's remediation work of such facilities is underway and is expected to fully utilise the facilities post necessary approvals from the regulator. During the year Company has reassessed the commercial prospects of Nutrition business and has classified the related assets as held for sale. • We have assessed the competence capabilities and objectivity of the experts (internal and external) used by the Company in the process of verification of assets assessing the usability of assets and determining recoverable amounts where required.
Given the significance of carrying value and judgement involved in assessing the recoverability of such facilities this is considered to be a key audit matter. Refer note 3(d) and 3(q) of accounting policy and note 4 42 and 52 in standalone financial statements • We have challenged the significant assumptions considered by the Company while carrying out impairment assessment for assets held for sale.
• We have verified the impairment calculation by the Company basis the recoverable amount determined.
• We have involved our valuation specialists to assess the valuation methodologies applied by the Company to determine the recoverable amount for the impairment calculation for assets held for sale
• We have evaluated adequacy of presentation and disclosure of assets held for sale and related impairment loss in accordance with applicable accounting standards.
Divestment of identified domestic branded business
During the year the Company has completed divestment of its identified domestic branded business (Business Undertaking) to Dr. Reddy's Laboratories Limited. Our audit procedures included the following:
The Company has disclosed the results of operations of this Business Undertaking during the year as discontinued operations and the profit from the aforesaid Transfer of Business Undertaking (excluding the Holdback Amount of Rs.300 crore) amounting to Rs.1470.32 crores has been reported as 'Exceptional Items - Discontinued operations'. • We have assessed the Company's accounting policies relating to discontinued operations by comparing with applicable accounting standards.
• We have read the minutes of meetings of Board of Directors of the Company Business Transfer Agreement and the Company's related press releases.
Given the size and complexity of transaction this is considered to be a key audit matter. • We have inquired with the key managerial personnel to obtain an understanding of the disposal process and the key terms of sale.
Refer note 3(q) of accounting policy and note 42 in standalone financial statements • We have verified the computation of gain on sale of Business Undertaking with underlying sale agreement and carrying value of net assets.
• We have verified the computation of tax including deferred tax adjustments on sale of Business Undertaking.
• We have evaluated the adequacy of the presentation and disclosures of discontinued operations and gain on sale of Business Undertaking in accordance with applicable accounting standards.

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 standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated. If based on thework we have performed we conclude that there is a material misstatement of this otherinformation we are required to report that fact. We have nothing to report in 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/ 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 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 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 Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone 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 standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Act we are also responsible for expressing our opinion on whether 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 standalone financial statementsmade by the Management and Board of Directors.

• Conclude on the appropriateness of the Management and Board of Directors use ofthe going 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 standalone 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 standalonefinancial statements including the disclosures and whether the standalone financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.

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

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

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

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.

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 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 standalone balance sheet the standalone statement of profit and loss (includingother comprehensive income) the standalone statement of changes in equity and thestandalone statement of 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 2021 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2021 from being appointed as a director in terms of Section164(2) of the Act.

f) With respect to the adequacy of the internal financial controls with reference tofinancial statements of the Company and the operating effectiveness of such 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 31 March 2021 onits financial position in its standalone financial statements - Refer Note 47 to thestandalone financial statements;

ii. The Company does not have any long-term contracts including derivative contractsfor which there were any material foreseeable losses.

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 financial statements since they do not pertain to thefinancial year ended 31 March 2021.

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

I n 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

Koosai Lehery

Partner

Membership No.: 112399

ICAI UDIN: 21112399AAAABQ3401

Place : Mumbai

Date : 27 May 2021

ANNEXURE - A TO THE INDEPENDENT AUDITORS' REPORT - 31 MARCH 2021

With reference to the Annexure A referred to in the Independent Auditors' Report to themembers of the Company on the standalone financial statements for the year ended 31 March2021 we report the following

(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 having regard to thesize of the Company and the nature of its assets. In accordance with this programmecertain fixed assets were physically verified by the Management during the year. In ouropinion and according to the information and explanation given to us no materialdiscrepancies were noticed 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:

I n respect of Freehold land with gross block and net block of ? 0.31 Crore for onefreehold land and Building comprising of twenty-two flats with gross block of ? 0.90 Croreand net block of ? 0.51 Crore.

(ii) The inventory except goods-in-transit and stocks lying with third parties hasbeen physically verified by the management during the year. In our opinion the frequencyof such verification is reasonable. For inventory lying with third parties at theyear-end confirmations have been obtained by the management and in respect ofgoods-in-transit subsequent goods receipts have been verified. The discrepancies noticedon verification between the physical stocks and the book records have been properly dealtwith 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 paragraphs 3 (iii) (a) (b) and (c) of the Order are notapplicable to the Company.

(iv) I n our opinion and according to the information and explanations given to us TheCompany has complied with the provisions of Section 185 and 186 of the Act with respectto the loans investments guarantees and securities.

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposit from the public during 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) We 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 respect ofproducts 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 respect of undisputed statutory dues including provident fund employees' stateinsurance income-tax goods and services tax duty of customs cess and other materialstatutory dues have been generally regularly deposited during the year by the Company withthe appropriate authorities.

According to the information and explanations given to us no undisputed statutory duesin respect of provident fund employees' state insurance income-tax goods and servicestax duty of customs cess and other material statutory dues were in arrears as at 31March 2021 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 Excise Goods and Services tax Customs Duty and Value added taxwhich have not been deposited as at 31 March 2021 on account of disputes are given inEnclosure I to this report.

(viii) In our opinion and according to the information and explanations given to usand based on the records of the Company the Company has not defaulted in repayment ofloans or borrowings to financial institutions banks and government. As per RBINotification ref. RBI/2019-20/186: DOR. No.BP.BC.47/21.04.048/2019-20 dated March 27 2020and DOR. No.BP.BC.71/21.04.048/2019-20 dated May 23 2020 on COVID-19 - RegulatoryPackage Company has availed the benefit of moratorium on payment of unpaid installmentsof the Company which were falling due for payment during the period 1 April 2020 to 30September 2020.

(ix) According to the information and explanations given to us the term loans havebeen applied by the Company during the year for the purposes for which they were obtained.The Company did not raise any money by way of initial public offer or further public offer(including debt instruments) and term loans during the year.

(x) According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe 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 the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Act.

(xii) I n our opinion and according to the information and explanations given to usthe Company 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 the provisions of Sections 177 and 188 of the Act where applicable anddetails of such transactions have been disclosed in the standalone financial statements asrequired by the 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. 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 any 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.

For B S R & Co. LLP

Chartered Accountants

Firm's Registration No. 101248W/W-100022

Koosai Lehery

Partner

Membership No.: 112399

ICAI UDIN: 21112399AAAABQ3401

Place : Mumbai

Date : 27 May 2021

ENCLOSURE I TO ANNEXURE A TO THE INDEPENDENT AUDITORS' REPORT - 31 MARCH 2021

Name of the statute Nature of dues Amount * (? in crore) Period to which the amount relates Forum where dispute is pending
Central Excise Act Goods destroyed in fire accident. 4.44 April 2005 to March 2009 CESTAT Ahmedabad
1944 Demand Interest and Penalty towards exemption availed in EOU Unit. 21.22 May 2004 to March 2007 CESTAT Mumbai
Demand Interest and Penalty for exempted goods cleared. 18.96 November 2006 to April 2013 CESTAT Mumbai
Education cess on Export Consignments 0.02 April 2005 to March 2006 Joint Commissioner
UP VAT/CST Act Demand under Section 28 & Section 9(2) 0.25 April 2009 to March 2010 Addl. Commissioner Grade 2 (Appeals) U.P
Sales Tax Due to under Invoicing and late deposit of tax 0.08 2003-04 to 2005-06 Joint Commissioner (Appeals) U.P
Demand under Section 28 & Section 9(2) 0.29 April 2008 to March 2009 Addl. Commissioner Grade 2 (Appeals) first Ghaziabad
Demand under Section 28 (2) 5.19 April 2014 to March 2015 Addl. Commissioner Grade 2 (Appeals) first Ghaziabad
WB VAT/CST Act Demand under various Sections 1.43 2007-08 UP 2014-15 Commissioner (Appeals) West Bengal
Kerala VAT Act Demand under Section 21 0.16 April 2011 to March 2014 Commissioner (Appeals) Kerala
Gujarat VAT Act Additional tax on Fuel consumption 0.60 April 2010 to March 2013 Joint Commissioner (Appeals) Gujarat
Central Sales Tax/ VAT Act Demand under CST and Goa VAT Act 1.25 2006-2007 Addl. Commissioner of Commercial Tax Goa
Demand under MVAT Act 3.04 April 2009 to March 2010 Maharashtra Sales Tax Tribunal
Demand under CST Act 0.41 April 2009 to March 2010 Maharashtra Sales Tax Tribunal
Demand and Penalty under MVAT Act 0.71 April 2009 to March 2010 Maharashtra Sales Tax Tribunal
Demand and Penalty under MVAT Act 19.39 April 2010 to March 2011 Maharashtra Sales Tax Tribunal
Demand and Penalty under CST Act 2.59 April 2010 to March 2011 Maharashtra Sales Tax Tribunal
Demand under CST Act 6.28 April 2011 to March 2012 Maharashtra Sales Tax Tribunal
Demand under MVAT Act 7.85 April 2011 to March 2012 Maharashtra Sales Tax Tribunal
Demand and Penalty under MVAT Act 8.72 April 2012 to March 2013 Maharashtra Sales Tax Tribunal
Demand under MVAT Act 0.76 April 2012 to March 2013 Maharashtra Sales Tax Tribunal
Demand under MVAT Act 4.16 April 2013 to March 2014 Maharashtra Sales Tax Tribunal
Demand under CST Act 0.27 April 2013 to March 2014 Maharashtra Sales Tax Tribunal
Demand under MVAT Act 14.03 April 2014 to March 2015 Joint Commissioner (Appeals)
Demand under CST Act 1.40 April 2014 to March 2015 Joint Commissioner (Appeals)
Demand under MVAT Act 4.09 April 2015 to March 2016 Deputy Commissioner
Demand under CST Act 0.13 April 2015 to March 2016 Deputy Commissioner
Demand under MVAT Act 3.91 April 2016 to March 2017 Joint Commissioner (Appeals)
Demand under CST Act 0.55 April 2016 to March 2017 Joint Commissioner (Appeals)
Goods and Services Tax Act 2017 Interest on late filing of GST returns of Himachal Pradesh for the period Jul'17 to Dec'17 due to technical glitches on GST portal 0.59 July 2017 to December 2017 Pending with First appellate authority
Recovery of excess refund issued on account of exports value was wrongly considered i.e. lower of statement-2 and FOB value. 1.66 April 2018 to March 2019 Pending with First appellate authority
The Finance Act 1994 (Service Tax) Interest and penalty on nonpayment of Service Tax on Import of certain services 0.81 April 2005 to March 2010 CESTAT Mumbai
Interest on non-payment of Service Tax on Import of certain services 0.07 April 2011 to March 2012 CESTAT Mumbai
Custom Act 1962 Customs Duty Penalty and Interest 0.39 June 2012 to November 2014 CESTAT Mumbai
Customs Duty Penalty and Interest 0.25 January 2013 to March 2015 CESTAT Mumbai
Income tax Act 1961 Demand under Section 143(3) 4.04 FY 2003-04 High Court
Demand under Section 143(3) 26.02 FY 2006-07 High Court
TDS Assessment order u/s 201/201(A) 1.99 FY 2009-10 Commissioner of Income Tax (Appeals) - TDS
Demand under Section 143(3) 20.17 FY 2010-11 Commissioner of Income Tax (Appeals)
TDS Assessment order u/s 201/201(A) 36.66 FY 2010-11 Commissioner of Income Tax (Appeals) - TDS
Demand under Section 143(3) 253.12 FY 2011-12 Commissioner of Income Tax (Appeals)
TDS Assessment order u/s 201/201(A) 42.47 FY 2011-12 Commissioner of Income Tax (Appeals) - TDS
Demand under Section 143(3) Nil FY 2012-13 Income Tax Appellate Tribunal
Demand under Section 143(3) Nil FY 2013-14 Commissioner of Income Tax (Appeals)
TDS (TRACES) 0.31 January 2012 to December 2017 TDS officers
TDS Assessment order u/s 201/201(A) 43.51 FY 2012-13 Commissioner of Income Tax (Appeals) - TDS
TDS Assessment order u/s 201/201(A) 36.30 FY 2013-14 Commissioner of Income Tax (Appeals) - TDS

Note 1: The aforesaid amounts under Income Tax Act 1961 are net off the below claimsmade by the assessee pending formal acceptance by the tax authorities for the relevantbenefit.

Financial Year Amount (in Crs) Pending acceptance by Tax authorities for
2012-13 67.29 Order giving effect ('OGE') to the favourable order of CIT(A) and rectification effect arising out of order for FY 2011-12
2010-11 27.33 Eligibility for entitlement and set-off of MAT credit utilisation arising out of the effect of OGE to the favourable order of CIT(A) for FY 2009-10
2013-14 21.00 Rectification application for granting credit for TDS deducted by non-resident

Note 2 : The aforesaid amounts under Income Tax Act 1961 does not include demandagainst which the favorable order has been received by the assesse but has been furtherappealed by tax authorities at higher level.

Financial Year Amount (in Crs) Forum where dispute is further appealed
2000-01 5.00 High Court
2004-05 12.68 High Court
2007-08 0.45 High Court

The above table does not include demand of Rs.85.70 Crores for Financial year 2009-10pertaining to dispute preferred by the tax authorities under section 40(a)(ia) of the Actwherein the dispute on applicability of TDS has been dismissed by the appellateauthorities. Demand amount of Rs.85.70 Crore is net off rectification application forgranting credit for TDS deducted by non-resident.

* out of the above amount paid/adjusted under protest by the Company for Excise VATService tax Custom Duty and income tax is Rs.0.47 Crore Rs.42.53 Crore Rs.0.15 CroreRs.0.22 Crores and Rs.85.71 Crores.

ANNEXURE B TO THE INDEPENDENT AUDITORS' REPORT ON THE STANDALONE FINANCIAL

STATEMENTS OF WOCKHARDT LIMITED FOR THE YEAR ENDED 31 MARCH 2021

Report on the internal financial controls with reference to the aforesaid standalonefinancial statements under Clause (i) of Sub-section 3 of Section 143 of the CompaniesAct 2013

(Referred to in paragraph (2A(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 Wockhardt Limited ("the Company") as of 31 March 2021 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

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 2021 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 Audit of 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 conduct of 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 audit ofinternal 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 financial statements were established and maintainedand 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 audit of 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 judgement including theassessment of the risks of material misstatement of 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 audit opinion on the Company's internal financial controls withreference to standalone financial statements.

Meaning of Internal Financial controls with Reference to Financial Statements

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 financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and (3)provide reasonable assurance regarding prevention or timely detection of unauthorisedacquisition use or disposition of the company's assets that could have a material effecton the standalone financial statements.

ANNEXURE - B TO THE INDEPENDENT AUDITORS' REPORT ON THE STANDALONE FINANCIAL STATEMENTSOF WOCKHARDT LIMITED FOR THE YEAR ENDED 31 MARCH 2021

Inherent Limitations of Internal Financial controls with Reference to FinancialStatements

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

For B S R & Co. LLP

Chartered Accountants

Firm's Registration No. 101248W/W-100022

Koosai Lehery

Partner

Membership No.: 112399

ICAI UDIN: 21112399AAAABQ3401

Place : Mumbai

Date : 27 May 2021.

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