Ajanta Pharma Ltd Directors Report.

To the Members of

Ajanta Pharma Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the standalone financial statements of Ajanta Pharma Limited ("the Company"), which comprise the standalone balance sheet as at 31 March 2020, and the standalone statement of profit and loss (including other comprehensive income), standalone statement of changes in equity and 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.

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 March 2020, and 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 section 143(10) 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 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 on the standalone financial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance 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 financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Description of Key Audit Matter

Fraud risk and accrual for sales returns and recalls in revenue recognition

The key audit matter How the matter was addressed in our audit
Refer note 6.9 of accounting policies and note 35 to the standalone financial statements. Our procedures in respect of recognition of revenue included the following:
As stated in Note 35 to the standalone financial statements, revenue from sale of products is recognized at a point in time when control of the products is transferred to the customer. Revenue from the sale of goods is measured at the fair value of the consideration received or receivable after adjusting variable components like sales returns. • Focusing on the revenue recognition accounting policies by comparing with applicable accounting standards;
The actual point in time when revenue is recognised varies depending on the specific terms and conditions of the sales contracts entered into with customers. The Company has a large number of customers operating in various geographies and sales contracts with these customers have distinct terms and conditions relating to the recognition of revenue and right of return. • Testing the design, implementation and operating effectiveness of the Companys manual and general IT controls and key IT applications. We tested the Companys controls over timely and accurate recording of revenue in the correct period;
Revenue is a key performance indicator for the Company. Accordingly, there could be pressure to meet the expectations of investors / other stakeholders and / or to meet revenue targets stipulated in performance incentive schemes for a reporting period. We have considered that there is a risk of fraud related to revenue being overstated by recognition in the wrong period or before control has passed. • Performing substantive testing of selected samples of revenue transactions recorded during the year- end. We used statistical sampling and verified contractual terms of sales invoices/contracts, shipping documents and acknowledged delivery receipts for those transactions;
Revenue is recognised net of accrual for sales returns and recalls. Significant estimation is required for establishing an accrual based on various factors. These factors include past trend, market conditions and introduction of new products. The methodology and assumptions used to estimate sales returns are monitored and adjusted regularly. These adjustments are in line with contractual and legal obligations, trade practices, historical trends, past experience and projected market conditions. • Testing Companys control over finished goods inventories recognized in the Companys balance sheet;
Accordingly, we identified recognition of revenue from sale of products and accrual for sales returns and recalls as a key audit matter. • Testing the sales return data and key considerations used to determine the accrual for sales returns and recalls. We assessed the methodology and assumptions used to estimate sales returns.
We examined the adjustments made to the said methodology and assumptions. These adjustments included the past trend of returns, impact of Covid on the market conditions, impact of new products and expected returns in future;
Performing retrospective test of accrual for sales returns and recalls to identify any bias; Analysing and testing high risk manual journals posted to revenue on a sample basis to identify any unusual items.

Impairment of Property, Plant and Equipment

The key audit matter How the matter was addressed in our audit
Refer note 6.1 to Accounting policies and note 8 to the standalone financial statements. Our procedures in this area included the following:
The carrying value of PPE represents 44 % of the total assets of the Company as at 31 March 2020. PPE is carried at cost less accumulated depreciation and accumulated impairment losses. PPE is assessed for impairment when an indicator of impairment exists. As stated in Note 6.1 to the standalone financial statements, if any such indication exists, the Company estimates the recoverable amount of the asset which is higher of the assets fair value less costs of disposal and its value in use. The Company has identified following indicators of impairment: • Evaluating the design, implementation and testing the operating effectiveness of key controls over the impairment assessment process. This included the estimation and approval of forecasts and determination of valuation models;
• Impact on sales resulting from the potential impact of the Covid 19 pandemic on the global economy, • Analysing the indicators of impairment of PPE;
• Anticipated delays in product approvals in regulated markets and • Understanding Companys assessment of those indicators;
• Capacity utilisation of certain plants. • Assessing the valuation methodology used for determining recoverable amount and testing the arithmetical accuracy of the impairment models;
The identification of impairment event and the determination of impairment charge require the application of significant judgement by the Company. The value in use calculation is based on a discounted cash flow model. It involves making certain assumptions and using estimates, in particular, with respect to the timing and amount of future cash flows of the asset. • Understanding from the Company regarding the basis and assumptions used for the projected future cash flows;
• Verifying the inputs used in projecting future cash flows. We challenged the business assumptions used, such as sales growth and the probability of success of new products;
• Challenging the assumptions used in estimating future cash flows for any inconsistency with the commercial strategy associated with the products;
These estimates include sales forecasts, estimation of costs, new product approvals, impact of competition on long term growth rate and applicable discounting rates. • Evaluating the valuation assumptions, such as discount rates, used by the Company;
There is inherent uncertainty and judgment in forecasting and discounting future cash flows. • Performing sensitivity analysis of key assumptions.
Due to the significance of the value of PPE and the possible indicators of impairment, we have considered assessment of impairment of PPE as a key audit matter. This included future revenue growth rates and the discount rates. These are applied in the valuation models;
• Evaluating the past performances where relevant and assessing historical accuracy of the forecast produced by the Company;
• Considering events or transactions occurring after the balance sheet date but before the reporting date for any adjustment to the conclusions reached on the carrying values of the assets and associated disclosures.
Insurance receivable
The key audit matter How the matter was addressed in our audit
Refer note 2 to Accounting policies and note 20 and 62 to the standalone financial statements. Our audit procedures include the following substantive procedures:
During the year, an incident at one of the plants operated by the Company caused damages to inventories and PPE. The total damages incurred have been assessed. The resulting loss, including inventory write-off, has been recorded in the year ended 31 March 2020. The Company has filed a claim for compensation with the insurance company. The claim is based on the terms and conditions of the insurance policy availed by the Company. As stated in Note 62 to the standalone financial statements, the expected income from insurance claim against the said losses has been recognised by the Company as an exceptional item. Determining the certainty of receiving the compensation and determining the amount of compensation receivable under the insurance policy requires judgement. Timing of recognition and amount of claim in the financial statements has been considered as a key audit matter. • Focusing on the accounting policies of compensation for the impairment of PPE and losses in the inventory by comparing with applicable accounting standards;
• Verifying the coverage of the insurance policy in respect of the incident as well as the assets destroyed during the incident;
• Assessing the Companys determination of loss of inventory based on usability of the remaining inventory after the incident and loss of PPE;
• Sighting the FIR filed by the Company to gain an understanding of the incident;
• Identifying probability of any dispute in respect of the claim based on related communications in respect of the claim;
• Assessing Companys judgement on its unconditional contractual right to receive compensation. We checked the Companys assessment of compliance with the conditions of the insurance contract;
• Verifying the Companys assessment of any indications of the claim not being accepted based on replies received from the insurance company after the lodging of the claim;
• Assessing determination of the amount of insurance claim based on the insurance claim filed by the Company;
• Verifying the provisional amounts received from the insurance company against the claim by the Company.

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 annual report but does not include the 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 and Board of Directors Responsibility for the Standalone Financial Statements

The Companys management and Board of Directors are responsible for the matters stated in section 134(5) 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 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, the 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 the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The 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 section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to 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 the Management and Board of Directors 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.

• 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. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be 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 the Order, 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 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 March 2020 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2020 from being appointed as a director in terms of Section 164(2) of the Act.

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 March 2020 on its financial position in its standalone financial statements - Refer Note 53 to the standalone financial statements;

ii. The Company has made provision, as required under the applicable law and accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts – Refer Note 48 to the financial statement.

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

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 financial statements since they do not pertain to the financial year ended 31 March 2020.

(C) With respect to the matter to be included in the Auditors Report under section 197(16): In our opinion and according to the information and explanations given to us, the remuneration paid 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 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 Section 197(16) which are required to be commented upon by us.

For B S R & Co. LLP
Chartered Accountants
Firms Registration No.101248W/W-100022
Sreeja Marar
Partner
Mumbai Membership No. 111410
20 May 2020 UDIN: 20111410AAAAAU9592

Annexure A to the Independent Auditors Report

31 March 2020

(Referred to in our report of even date)

(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 programme of physical verification of its by which all fixed assets are verified in a phased manner over a period of three years. In accordance with this programme, a portion of the fixed assets has been physically verified by the management during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

(c) According to the information and explanations given to us and based on the examination of the registered sale deed/transfer deed/conveyance deed/share certificate/other documents evidencing title, we report that the title deeds of immovable properties of land and building which are freehold, as disclosed in Note 8 to the standalone financial statements, are held in the name of the Company. In respect of immovable properties of land and buildings that have been taken on lease and disclosed as right of use assets in Note 8 to the standalone financial statements, the lease agreements are in the name of the Company.

(ii) The inventory, except goods-in-transit and goods lying with third parties, has been physically verified by the management at reasonable intervals during the year. In our opinion, the frequency of such verification is reasonable. In respect of inventory lying with third parties at year end, these have substantially been confirmed by them. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) In our opinion and according to 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, paragraph 3(iii) of the Order is not applicable to the Company.

(iv) In our opinion and according to the information and explanation given to us, the Company has complied with the provisions of Section 186 of the Act, in respect of making investments as applicable. The Company has not granted any loans or provided any guarantees or security on behalf of the parties covered under Section 185 of the Act. (v) According to the information and explanations given to us, the Company has not accepted any deposits as per the directives issued by the Reserve Bank of India under the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under. Accordingly, paragraph 3(v) of the Order is not applicable to the Company.

(vi) We have broadly reviewed the records maintained by the Company pursuant to the rules prescribed by Central Government for maintenance of cost records under Section 148 (1) of the Act for drugs and pharmaceutical products and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

(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 income-tax, duty of customs, provident fund, employees state insurance, goods and service tax, cess and other material statutory dues have been generally regularly deposited during the year by the Company with the appropriate authorities, though there have been slight delays in few payments of provident fund and professional tax. 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 service tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues were in arrears as at 31 March 2020 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Income tax, Sales Tax, Value added tax, Service tax, duty of Customs, duty of Excise, Goods and Service tax and Cess which have not been deposited with the appropriate authorities on account of any dispute, except as stated below.

Rs. in Crore
Name of the Statute Nature of dues Amount Demanded Amount not deposited under dispute Amount deposited under dispute Period to which the amount relates Forum where dispute is pending
Central Goods & Service Tax Act, 2017 GST 0.26 0.25 0.01 FY 2017-18 Joint Commissioner (Appeals), Hyderabad
Central Goods & Service Tax Act, 2017 GST 0.01 0.01 - FY 2017-18 Assistant Commissioner, Palghar
Central Excise Act 1944 Excise duty 0.20 0.20 - FY 2010-11 to FY 2015-16 CESTAT, Bengaluru
Central Excise Act 1944 Excise duty 0.05 0.05 - FY 2006-07 to FY 2010-11 CESTAT, Mumbai
Kerala VAT Act VAT 1.83 1.63 0.20 FY 2012-13 Deputy Commissioner (Appeals) SGST, Ernakulam
Central Sales Tax Act CST 0.04 0.03 0.01 FY 2012-13 Deputy Commissioner (Appeals) SGST, Ernakulam
Gujarat VAT Act CST 0.02 0.02 - FY 2015-16 Assistant Commissioner, Ahmedabad
Assam VAT Act CST 0.01 0.01 - FY 2016-17 Superintendent of Taxes, Guwahati

(vii) In our opinion and according to the information and explanations given to us, the Company does not have any loans or borrowings from any financial institution or bank or Government, nor has it issued any debentures.

Accordingly paragraph 3(viii) of the Order is not applicable to the Company.

(viii) According to information and explanation given to us and based on our examination of the records of the Company, the Company has not raised any money by way of initial public offer, further public offer (including debt instruments) and term loans during the year. Accordingly, the paragraph 3(ix) of the Order are not applicable to the Company.

(ix) According to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the year.

(x) According to the information and explanations give to us and based on our examination of the records, 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.

(xi) According to the information and explanations given to us, the Company is not a Nidhi company and the Nidhi Rules, 2014 are not applicable to it. Accordingly, paragraph 3(xii) of the Order is not applicable to the Company.

(xii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with related parties are in compliance with the provisions of Sections 177 and 188 of the Act, where applicable and the details of such related party transactions have been disclosed in the standalone financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act read with the relevant rules issued thereunder.

(xiii) According to the information and explanations give to us and based on our examination of the records, 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.

(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 entered into any non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable to the Company.

(xv) In our opinion and according to the information and explanations 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 B S R & Co. LLP
Chartered Accountants
Firms Registration No.101248W/W-100022
Sreeja Marar
Partner
Mumbai Membership No. 111410
20 May 2020 UDIN: 20111410AAAAAU9592

Annexure B to the Independent Auditors Report

on the standalone financial statements of Ajanta Pharma Limited for the period ended 31 March 2020.

Report on the internal financial controls with reference to the aforesaid standalone financial statements under Clause (i) of Subsection 3 of Section 143 of the Companies Act, 2013 (Referred to in paragraph 2(A)(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 Ajanta Pharma Limited ("the Company") as of 31 March 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 March 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 section 143(10) 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 financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial controls with reference to 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 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 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 B S R & Co. LLP
Chartered Accountants
Firms Registration No.101248W/W-100022
Sreeja Marar
Partner
Mumbai Membership No. 111410
20 May 2020 UDIN: 20111410AAAAAU9592