To the Members of Hexaware Technologies Limited
Report on the Audit of the Standalone Financial Statements
Opinion
We have audited the standalone financial statements of Hexaware
Technologies Limited ("the Company"), which comprise the standalone balance
sheet as at 31 December 2020, the standalone statement of profit and loss (including other
comprehensive income), standalone statement of changes in equity and the standalone
statement of cash flows for the year then ended, and notes to the standalone financial
statements including a summary of the significant accounting policies and other
explanatory information (hereinafter referred to as the "standalone financial
statements").
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone financial statements give the
information required by the Companies Act, 2013 ("Act") in the manner so
required and give a true and fair view in conformity with the accounting principles
generally accepted in India, of the state of affairs of the Company as at 31 December
2020, and of its profit and other comprehensive income, 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) specified under sub-section (10) of Section 143 of the Act. Our responsibilities
under those SAs are further described in the Auditors Responsibilities for the Audit
of the Standalone Financial Statements section of our report. We are independent of the
Company in accordance with the Code of Ethics issued by the Institute of Chartered
Accountants of India ("ICAI") together with the ethical requirements that are
relevant to our audit of the standalone financial statements under the provisions of the
Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in
accordance with these requirements and the Code of Ethics. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Other Information
The Companys management and Board of Directors are responsible
for the Other Information. The Other Information comprises the information included in the
Companys board report but does not include the standalone financial statements and
our auditors report thereon.
Our opinion on the standalone financial statements does not cover the
Other Information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements,
our responsibility is to read the Other Information and, in doing so, consider whether the
Other Information is materially inconsistent with the standalone financial statements or
our knowledge obtained in the audit or otherwise appears to be materially misstated. If,
based on the work we have performed, we conclude that there is a material misstatement of
this Other Information, we are required to report that fact.
We have nothing to report in this regard.
Managements Responsibility for the Standalone Financial
Statements
The Companys management and Board of Directors are responsible
for the matters stated in sub-section (5) of Section 134 of the Act with respect to the
preparation of these standalone financial statements that give a true and fair view of the
state of affairs, profit/loss and other comprehensive income, changes in equity and cash
flows of the Company in accordance with the accounting principles generally accepted in
India, including the Indian Accounting Standards (Ind AS) specified under Section 133 of
the Act.
This responsibility also includes maintenance of adequate accounting
records in accordance with the provisions of the Act for safeguarding of the assets of the
Company and for preventing and detecting frauds and other irregularities; selection and
application of appropriate accounting policies; making judgments and estimates that are
reasonable and prudent; and design, implementation and maintenance of adequate internal
financial controls that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and presentation of
the standalone financial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management and Board
of Directors are responsible for assessing the Companys ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless management either intends to liquidate the
Company or to cease operations, or has no realistic alternative but to do so.
Board of Directors is also responsible for overseeing the
Companys financial reporting process.
Auditors Responsibilities for the Audit of the Standalone
Financial Statements
Our objectives are to obtain reasonable assurance about whether the
standalone financial statements as a whole are free from material misstatement, whether
due to fraud or error, and to issue an auditors report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with SAs will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional
judgment and maintain professional skepticism throughout the audit. We also:
• identify and assess the risks of material misstatement of the
standalone financial statements, whether due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control;
• obtain an understanding of internal control relevant to the
audit in order to design audit procedures that are appropriate in the circumstances. Under
clause (i) of sub-section (3) of Section 143 of the Act, we are also responsible for
expressing our opinion on whether the company has adequate internal financial controls
with reference to standalone financial statements in place and the operating effectiveness
of such controls;
• evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures in the standalone financial
statements made by the Management and Board of Directors;
• conclude on the appropriateness of managements use of the
going concern basis of accounting and, based on the audit evidence obtained, whether a
material uncertainty exists related to events or conditions that may cast significant
doubt on the Companys ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in our auditors
report to the related disclosures in the standalone financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditors report. However, future events or
conditions may cause the Company to cease to continue as a going concern; and
• evaluate the overall presentation, structure and content of the
standalone financial statements, including the disclosures, and whether the standalone
financial statements represent the underlying transactions and events in a manner that
achieves fair presentation.
We communicate with those charged with governance regarding, among
other matters, the planned scope and timing of the audit and significant audit findings,
including any significant deficiencies in internal control that we identify during our
audit.
We also provide those charged with governance with a statement that we
have complied with relevant ethical requirements regarding independence, and to
communicate with them all relationships and other matters that may reasonably be thought
to bear on our independence, and where applicable, related safeguards.
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 sub-section (11) of
Section 143 of the Act, we give in the "Annexure A" a statement on the matters
specified in paragraphs 3 and 4 of the Order, to the extent applicable.
(A) As required by sub-section (3) of Section 143 of the Act, we report
that:
a) we have sought and obtained all the information and explanations
which to the best of 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 the Company so far as it appears from our examination of those books;
c) the standalone balance sheet, the standalone statement of profit and
loss (including other comprehensive income), the standalone statement of changes in equity
and the standalone statement of cash flows dealt with by this Report are in agreement with
the books of account;
d) in our opinion, the aforesaid standalone financial statements comply
with the Ind AS specified under Section 133 of the Act;
e) on the basis of the written representations received from the
directors as on 31 December 2020 taken on record by the Board of Directors, none of the
directors is disqualified as on 31 December 2020 from being appointed as a director in
terms of sub-section (2) of Section 164 of the Act; and
f) with respect to the adequacy of the internal financial controls with
reference to financial statements of the Company and the operating effectiveness of such
controls, refer to our separate Report in "Annexure B".
(B) With respect to the other matters to be included in the
Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and 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
December 2020 on its financial position in its standalone financial statements
- refer Note 29 to the standalone financial statements;
ii. the Company has made provision, as required under the applicable
law or accounting standards, for material foreseeable losses, if any, on longterm
contracts including derivative contracts
- refer Note 31 to the standalone financial statements;
iii. there has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the Company; and
iv. the disclosures in the standalone financial statements regarding
holdings as well as dealings in specified bank notes during the period from 8 November
2016 to 30 December 2016 have not been made in these standalone financial statements since
they do not pertain to the financial year ended 31 December 2020.
(C) With respect to the matter to be included in the Auditors
Report under sub-section (16) of Section 197:
In our opinion and according to the information and explanations given
to us, the remuneration paid / payable by the Company to its directors during the current
year is in accordance with the provisions of Section 197 of the Act.
The remuneration paid / payable to any director is not in excess of the
limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not
prescribed other details under sub-section (16) of Section 197 which are required to be
commented upon by us.
|
For BS R&Co. LLP |
|
Chartered Accountants |
|
Firms Registration No:
101248W/W-100022 |
|
Rajesh Mehra |
|
Partner |
| Mumbai |
Membership No: 103145 |
| 12 February 2021 |
ICAI UDIN: 21103145AAAABH3915 |
Annexure A to the Independent Auditors Report
On the standalone financial statements of Hexaware Technologies Limited
for the year ended 31 December 2020
Referred to in paragraph (1) under ‘Report on Other Legal and
Regulatory Requirements section of our report of even date, we report the following:
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed assets.
(b) The Company has a regular program of physical verification of its
fixed assets, by which all the items of fixed assets are covered in a phased manner over a
period of three years. In our opinion, this periodicity of physical verification is
reasonable having regard to the size of the Company and the nature of its assets. Pursuant
to the program, certain fixed assets were physically verified by the Management during the
year and no material discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and on
the basis of examination of the records of the Company, the title deeds of immovable
properties included in property, plant and equipment are held in the name of the Company.
In respect of immovable properties taken on lease and disclosed as right-of-use assets in
the standalone financial statements, the lease agreements are in the name of the Company,
except for one parcel of leasehold land at Nagpur (amounting to X 78.06 million),
disclosed in Note 3 to the standalone financial statements.
(ii) The Company is a service company primarily engaged in providing
information technology and related services. Accordingly, it does not hold any physical
inventories. Thus, paragraph 3(ii) of the Order are not applicable to the Company.
(iii) According to the information and explanations given to us, the
Company has not granted any loans, secured or unsecured, to companies, firms, limited
liability partnerships or other parties covered in the register maintained under Section
189 of the Act. Accordingly, paragraphs 3(iii) (a), (b) and (c) of the Order are not
applicable to the Company.
(iv) In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of Section 185 and 186 of the
Act, with respect to the investments made and guarantees given. The Company had not
granted any loan or security to the parties covered under the provisions of Section 185
and 186 of the Act. Accordingly, compliance under Section 185 and 186 of the Act in
respect of pending loan or securities are not applicable to the Company.
(v) According to the information and explanations given to us, the
Company has not accepted any deposits from the public within the meaning of the directives
issued by the Reserve Bank of India, provisions of Section 73 to 76 of the Act, any other
relevant provisions of the Act and the relevant rules framed thereunder. Accordingly,
paragraph 3(v) of the Order are not applicable to the Company.
(vi) The Central Government has not prescribed the maintenance of cost
records under Section 148 of the Act for any of the services rendered by the Company.
Accordingly, paragraph 3(vi) of the Order are not applicable to the Company.
(vii) (a) According to the information and explanations given to us and
on the basis of our examination of the records of the Company, amounts deducted/ accrued
in the books of account in respect of undisputed statutory dues including Provident fund,
Employees State Insurance, Income-tax, Goods and Services tax, duty of Customs and
other material statutory dues have been generally regularly deposited during the year by
the Company with the appropriate authorities.
As explained to us, the Company did not have any dues on account of
duty of excise and cess.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident fund, Employees State Insurance,
Income- tax, Goods and Services tax, duty of Customs and other material statutory dues
were in arrears as at 31 December 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 of Income-tax or Sales tax or Service tax or Goods and Services tax or duty of
Customs or Value added tax and other material statutory dues which have not been deposited
with appropriate authorities on account of disputes except for the following,:
| Name of the Act |
Nature of Dues |
Amount (Rs. in million) |
Period to which amount relates |
Forum where dispute is pending |
| Income-tax Act, 1961 |
Income-tax |
1.10 |
Financial year 2008-09 |
Assessing Officer |
| Income-tax Act, 1961 |
Income-tax |
2.76 |
Financial year 2010-11 |
Commissioner of Income Tax (Appeals) |
(viii) In our opinion and according to the information and explanations
given to us, the Company did not have any outstanding loans or borrowings from any
financial institution, bank or Government and there are no dues to debenture holders
during the year.
(ix) In our opinion and according to the information and explanations
given to us, 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. Accordingly,
paragraph 3(ix) of the Order is not applicable to the Company.
(x) During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted auditing practices in
India, and according to the information and explanations given to us, we have neither come
across any instance of fraud by the Company or any material instances of fraud on the
Company by its officers or employees, noticed or reported during the year, nor have we
been informed of any such case by the management.
(xi) In our opinion and according to the information and explanations
given to us and based on examination of the records of the Company, the Company has paid/
provided for managerial remuneration in accordance with the requisite approvals mandated
by the provisions of Section 197 read with Schedule V to the Act.
(xii) In our opinion and according to the information and explanations
given to us, the Company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the
Order is not applicable to the Company.
(xiii) According to the information and explanations given to us and
based on our examination of the records of the Company, all transactions with the related
parties are in compliance with Sections 177 and 188 of the Act, where applicable, and
details of such transactions have been disclosed in the standalone financial statements as
required by the applicable accounting standards.
(xiv) According to the information and explanations given to us and
based on our examination of the records of the Company, the Company has not made any
preferential allotment or private placement of shares or fully or partly convertible
debentures during the year. Accordingly, paragraph 3(xiv) of the Order is not applicable
to the Company.
(xv) According to the information and explanations given to us and
based on our examination of the records of the Company, the Company has not entered into
non-cash transactions with directors or persons connected with him. Accordingly, paragraph
3(xv) of the Order is not applicable to the Company.
(xvi) In our opinion and according to the information and explanation
given to us, the Company is not required 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 BS R&Co. LLP |
|
Chartered Accountants |
|
Firms Registration No: 101248W/W-
100022 |
|
Rajesh Mehra |
|
Partner |
| Mumbai |
Membership No: 103145 |
| 12 February 2021 |
ICAI UDIN: 21103145AAAABH3915 |
Annexure B to the Independent Auditors Report
On the standalone financial statements of Hexaware Technologies Limited
for the year ended 31 December 2020
Report on the internal financial controls with reference to the
aforesaid standalone financial statements under clause (i) of Sub-section 3 of Section 143
of the Companies Act, 2013
(Referred to in paragraph (f) under Report on Other Legal and
Regulatory Requirements section of our report of even date)
Opinion
We have audited the internal financial controls with reference to
standalone financial statements of Hexaware Technologies Limited ("the Company")
as of 31 December 2020 in conjunction with our audit of the standalone financial
statements of the Company for the year ended on that date.
In our opinion, the Company has, in all material respects, adequate
internal financial controls with reference to standalone financial statements and such
internal financial controls were operating effectively as at 31 December 2020, based on
the internal financial controls with reference to standalone financial statements criteria
established by the Company considering the essential components of internal control stated
in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting
issued by the Institute of Chartered Accountants of India (the "Guidance Note").
Managements Responsibility for Internal Financial Controls
The Companys management and the Board of Directors are
responsible for establishing and maintaining internal financial controls based on the
internal financial controls with reference to standalone financial statements criteria
established by the Company considering the essential components of internal control stated
in the Guidance Note. These responsibilities include the design, implementation and
maintenance of adequate internal financial controls that were operating effectively for
ensuring the orderly and efficient conduct of its business, including adherence to
companys policies, the safeguarding of its assets, the prevention and detection of
frauds and errors, the accuracy and completeness of the accounting records, and the timely
preparation of reliable financial information, as required under the Companies Act, 2013
(hereinafter referred to as "the Act").
Auditors Responsibility
Our responsibility is to express an opinion on the Companys
internal financial controls with reference to standalone financial statements based on our
audit. We conducted our audit in accordance with the Guidance Note and the Standards on
Auditing, prescribed under sub-section (10) of Section 143 of the Act, to the extent
applicable to an audit of internal financial controls with reference to standalone
financial statements. Those Standards and the Guidance Note require that we comply with
ethical requirements and plan and perform the audit to obtain reasonable assurance about
whether adequate internal financial controls with reference to standalone financial
statements were established and maintained and whether such controls operated effectively
in all material respects.
Our audit involves performing procedures to obtain audit evidence about
the adequacy of the internal financial controls with reference to standalone financial
statements and their operating effectiveness. Our audit of internal financial controls
with reference to standalone financial statements included obtaining an understanding of
such internal financial controls, assessing the risk that a material weakness exists, and
testing and evaluating the design and operating effectiveness of internal control based on
the assessed risk. The procedures selected depend on the auditors judgement,
including the assessment of the risks of material misstatement of the standalone financial
statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the Companys internal
financial controls with reference to standalone financial statements.
Meaning of Internal Financial controls with Reference to Standalone
Financial Statements
A companys internal financial controls with reference to
standalone financial statements is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of standalone
financial statements for external purposes in accordance with generally accepted
accounting principles. A companys internal financial controls with reference to
standalone financial statements include those policies and procedures that (1) pertain to
the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of standalone
financial statements in accordance with generally accepted accounting principles, and that
receipts and expenditures of the company are being made only in accordance with
authorisations of management and directors of the company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorised acquisition, use, or
disposition of the companys assets that could have a material effect on the
standalone financial statements.
Inherent Limitations of Internal Financial controls with Reference to
Standalone Financial Statements
Because of the inherent limitations of internal financial controls with
reference to standalone financial statements, including the possibility of collusion or
improper management override of controls, material misstatements due to error or fraud may
occur and not be detected. Also, projections of any evaluation of the internal financial
controls with reference to standalone financial statements to future periods are subject
to the risk that the internal financial controls with reference to standalone financial
statements may become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.
|
For BS R&Co. LLP |
|
Chartered Accountants |
|
Firms Registration No:
101248W/W-100022 |
|
Rajesh Mehra |
|
Partner |
| Mumbai |
Membership No: 103145 |
| 12 February 2021 |
ICAI UDIN: 21103145AAAABH3915 |
+91-9892691696
