Fresenius Kabi Oncology Ltd Auditor Reports

TO THE MEMBERS OF FRESENIUS KABI ONCOLOGY LIMITED

Report on the Audit of Financial Statements

Opinion

We have audited the financial statements of Fresenius Kabi Oncology Limited ("the Company"), which comprise the Balance Sheet as at 31st March 2019, and the Statement of Profit and Loss, including Other Comprehensive Income, the Statement of Changes in Equity and the Statement of Cash Flow statement for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information (hereinafter referred to as "the financial statements").

in our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the companies Act, 2013 ("the Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (indian Accounting Standards) Rules, 2015, as amended, ("ind AS") and other accounting principles generally accepted in india, of the state of affairs of the company as at March 31, 2019, the profit and total comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Act (SAs). Our responsibilities under those Standards are further described in the Auditors Responsibilities for the Audit of the 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 independence requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAIs Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Information Other than the Financial Statements and Auditors Report Thereon

The Companys Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Boards Report including Annexures to Boards Report and Directors Responsibility Report, but does not include the financial statements and our auditors report thereon.

Our opinion on the 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 financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained during the course of our 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 Financial Statements

The Companys Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance, total comprehensive income, changes in equity and cash flows of the Company in accordance with the Ind AS and other accounting principles generally accepted in india. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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 financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, Board of Directors is 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.

The Board of Directors are responsible for overseeing the Companys financial reporting process

Auditors Responsibility for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the 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 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 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 financial controls 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 system 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 made by management. ^•

• 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 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 financial statements, including the disclosures, and whether the 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, issued by the Central Government of india in terms of sub-section (11) of section 143 of the Act (hereinafter referred to as the "Order"), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

(b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.

(c) The Balance Sheet, Statement of Profit and Loss including Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid Ind AS financial statements comply with the Accounting Standards under Section 133 of the Act read with Companies (Indian Accounting Standards) Rules, 2015, as amended;

(e) On the basis of written representations received from the directors as on March 31, 2019, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2019, 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 over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in Annexure B to this report;

(g) 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 on its financial position in its Ind AS financial statements - Refer Note 34 of the Notes to the Ind AS financial statements;

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

iii. the company does not have any dues that are required to be transferred to the Investor Education and Protection Fund.

	For VMT & Co. LLP
	Firm registration No. N500048
	chartered accountants
	Vanit Kumar Mittal
Place: Gurugram	Partner
Date: 10th may, 2019	membership No. 505709

Annexure A to the Independent Auditors report of even date to the members of FRESENIUS KABI ONCOLOGY LIMITED on the financial statements as of and for the year ended March 31, 2019

i. (a) The Company has maintained proper records showing full, including quantitative details and situation, of fixed assets.

(b) All the fixed assets have been physically verified by the Management during the year as per regular program of verification, which, in our opinion, is reasonable having regard to the size of the Company and nature of its assets. No material discrepancies have been noticed on such verification.

(c) According to the information and explanations given by the management, the title deeds of immovable properties, included in property, plant and equipment, are held in the name of the company. (in respect of certain immovable properties including building, and disclosed as fixed asset in the financial statements, the arrangement, in the nature of lease, are in the name of the Company, where the Company is the beneficiary in the agreement.)

ii. The management has conducted the physical verification of inventory at reasonable interval during the year by the management and no material discrepancies were noticed on such physical verification.

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, the provisions of clause 3(iii) (a), (b) and (c) of the Order are not applicable to the company and hence, not commented upon.

iv. in our opinion and according to the information and explanation given to us, the company has not advanced any loans to directors/ to a company in which the director is interested to which the provisions of section 185 of the companies act, 2013 apply and hence, not commented upon. As per the information and explanation provided to us, the company has made no loans, investment or furnished guarantee within the meaning of section 186 of the companies Act, 2013.

v. the company has not accepted any deposits from the public within the meaning of Sections 73 to 76 of the Act and the companies (acceptance of Deposit) Rules, 2014 (as amended). accordingly, the provisions of clause 3(v) of the Order are not applicable to the company.

vi. We have broadly reviewed the books of accounts maintained by company pursuant to the rules made by the central Government for the maintenance of cost records under section 148(1) of the companies act, 2013, and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, undisputed statutory dues including provident fund, employees state insurance, income tax, goods & services tax, Customs Duty, Cess and other material statutory dues, as applicable, have generally been regularly deposited with the appropriate authorities. according to the information and explanations given to us, there were no outstanding statutory dues as on march 31, 2019 for a period more than six months from the date they become payable.

(b) The dues on account of Income Tax, Sales Tax, Service Tax, Custom duty, Excise Duty and Value Added Tax disputed by the company and not being paid, visa-vis forums where such disputes are pending are mentioned below:

Name of the Statute	Nature of the Dues	Disputed Amount (In Rs. Lakhs)	Period to which amount relates (Financial Year)	Forum where the dispute is pending
Income Tax Act, 1961	Corporate Tax adjustments	221.91	2010-11, 2012-13 & 2013-14	cit (appeals)
		14.15	2009-10 to 2011-12	Income Tax appellate Tribunal
		2.91	2014-15	dispute resolution Panel
		10.25	2006-07	High court, delhi
	Transfer Pricing adjustments	243.22	2013-14	ciT (Appeals)
		245.38	2009-10 to 2011-12	Income Tax Appellate Tribunal
		3,519.79	2014-15	dispute resolution Panel
		181.51	2004-05 & 2006-07	High court, delhi
Central Excise act, 1944	cenvat related	945.66	2013-14 & 2014-15	Commissioner (Appeals)
		5,361.96	1998 to 2005, 2008-09 to 2015-16	cestat
	Refund of rebate claim	535.40	2010-11	cestat
		55.66	2010-11	High court
	Duty on testing sampling	2.41	1999-2001	Commissioner (Appeals)
		378.15	2005-06 to 2017-18	cestat
	Service Tax - input credit	894.13	2013-14 to 2016-17	Commissioner (Appeals)
Finance act, 1994	Payment against reverse charge mechanism on legal consultancy services	103.45	2013 to 2018	Applicability challenged with unfavourable order from bombay High court stayed by Supreme court of india on petition of bar council
Customs Duty, 1962	Export obligation against Advance Licenses	9	2015-16	Customs/ DGFT

viii. In our opinion and according to the information and explanations given by the management, the Company has not defaulted in repayment of loans or borrowings to a bank. There are no dues which are payable to financial institutions or to government. The Company did not have any debenture holders during the year.

ix. According to the information and explanations given to us, the Company has not raised any moneys by way of initial public offer or further public offer (including debt instruments) during the year. term loans obtained have been applied for the purpose for which those were raised there were no default or delay in repayment of principal and interest thereon.

x. Based on the audit procedures performed for the purposes of reporting the true and fair view of the financial statements and according to the information and explanations given by management, we report that no fraud by the company or on the company by the officers or employees of the company has been noticed or reported during the year.

xi. According to the information and explanation given to us by management, the managerial remuneration has been paid/ provided in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the companies Act, 2013.

xii. In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of Clause 3(xii) of the Order are not applicable to the company and hence, not commented upon.

xiii. According to the information and explanations given by management, the transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the notes to financial statements, as required by the applicable accounting standards.

xiv. According to the information and explanations given by management, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the company and hence, not commented upon.

xv. According to the information and explanations given by management, the company has not entered into any noncash transactions with its directors or persons connected with him as referred to in section 192 of the Companies Act, 2013.

xvi. According to the information and explanations given by management, the company is not required to be registered under section 45-IA of the Reserve Bank of india act, 1934. accordingly, the provisions of clause 3(xvi) of the Order are not applicable to the Company.

	For VMT & Co. LLP
	Firm registration No. N500048
	Chartered Accountants
	Vanit Kumar Mittal
Place: Gurugram	Partner
Date: 10th May, 2019	Membership No. 505709

Annexure B to the Independent Auditors report of even date to the members of FRESENIUS KABI ONCOLOGY LIMITED on the financial statements for the year ended 31^st March, 2019

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")

We have audited the internal financial controls over financial reporting of Fresenius Kabi Oncology Limited ("the Company") as of 31^st March, 2019 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Managements Responsibility for Internal Financial Controls

The Companys management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting 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 (‘ICAI). 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.

Auditors Responsibility

Our responsibility is to express an opinion on the Companys internal financial controls over financial reporting based on our audit. We have conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing as specified under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls and, both issued by the Institute of Chartered Accountants of India. 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 over financial reporting was established and maintained and if 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 system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, 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 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 internal financial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A companys internal financial control over financial reporting 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 control over financial reporting includes 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 financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, 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 over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31^st March, 2019, based on the internal control over financial reporting 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.

	For VMT & Co. LLP
	Firm Registration No. N500048
	Chartered Accountants
	Vanit Kumar Mittal
Place: Gurugram	Partner
Date: 10th May, 2019	Membership No. 505709