HPL Electric & Power Auditors Report


To the Members of HPL ELECTRIC & POWER LIMITED

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of HPL ELECTRIC & POWER LIMITED (“the Company”), which comprise the Balance sheet as at 31 March 2023, the Statement of Profit and Loss, the Statement of changes in Equity and Statement of Cash Flows for the year then ended on that date, and notes to the financial statements, including a summary of 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 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 accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2023, its profit/loss, changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial in accordance with the Standards on Auditing (“SAs”) under Section 143(10) of the Act. 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 ethical requirements that are relevant to our audit of the standalone financialstatements 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 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 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 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. We have determined the matters described below to be the key audit matters to be communicated in our report.

Key Audit Matters

How the matter was addressed in our Audit

Revenue recognition Fixed Price Development Contracts

Principal Audit Procedures

Revenue recognition in respect of fixed price contracts involves critical estimates. Estimated effort is a estimate to determine revenue and liability for onerous obligations. This estimate has a high inherent uncertainty as it requires consideration of progress of the contract, efforts incurred till date and efforts required to complete the remaining contract performance obligations. Our audit approach was a combination of test of internal controls and critical substantive procedures which included the following:

Evaluated the design of internal controlsrelatingto recording of efforts incurred and estimationof efforts required to complete the performance obligations.

Tested the access and application controls pertaining to time recording, allocation and budgeting systems which prevents unauthorized changes to recording of efforts incurred.

Selected a sample of contracts and through inspection of evidence of performance of these controls, tested the operating effectiveness of the internal controls relating to efforts incurred andestimated.

Selected a sample of contracts and performed a retrospective review of efforts incurred with estimated efforts to identify significant variations and verify whether those variations have been considered in estimating the remaining efforts to complete the contract.

Reviewed a sample of contracts with unbilled revenues to identify possible delays in achieving milestones, which require change in estimated efforts to complete the remaining performance obligations.

Performed analytical procedures and test of details for reasonableness of incurred and estimated efforts.

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 Management discussion and analysis, Boards Report including Annexures to Boards Report but does not include the financial

Our opinion on the financial statements does not information 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 standalone financial 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.

Responsibilities of

Governance for the Standalone Financial Statements

The Companys Board of Directors is responsible for the matters stated in Section of these standalone financial view of the financial other 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 of the assets of the Company and for preventing and detecting frauds selection making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial give a true and fair view and are free from material misstatement, whether due to fraud or error. that may cast significant In preparing the standalone financial statements, Management 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 the Management either intends to liquidate the Company or to cease operations,orhasnorealisticalternative but to do so.

The Board of Directors are also responsible for overseeing the Companys financial

Auditors Responsibilities for the Audit of the Financial

Our objectives are to obtain reasonable assurance about whether the standalone financialstatements 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 andourAuditorsreportthereon. with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or covertheother error and are considered material if, individually or in the aggregate, andwedonotexpressany formofassuranceconclusion 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 Audit. We also: statements or our knowledge obtained

Identify and assess the risks of material misstatement of the standalone financialstatements, 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 material misstatement resulting from fraud is higher than for Management from error, as fraud may involve collusion, forgery, oneresulting and Those Charged with intentional omissions, misrepresentations,or internal control.

134(5) of the Act with respect to the preparation

Obtain an understanding of internalstatementsthatgive financialtrueandfair to the audit in order to design audit procedures that are position,financialperformance, including appropriate in the circumstances. Under Section the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial systems with reference to standalone financialstatements in place and the operating effectiveness of such controls. and other irregularities;

Evaluate the appropriateness of Accounting policies used and application of appropriate accounting policies; and the reasonableness of Accounting estimates and related disclosures made by the Management. for ensuring the

Conclude on the appropriateness of Managements use of the going concern basis of Accounting and, based on the audit statements that evidence obtained, whether a material uncertainty exists doubt related to events or conditions 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 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 conditionsmay cause the Company oingtoceasetocontinue concern. as a

Evaluate the overall presentation, structure and content of the process. standalone financial whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be influenced. We consider quantitative materiality and qualitative factors (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the standalone financial statements.

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 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, 2020 (“the Order”), issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Companies Act, 2013, 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. As required by Section 143 (3)

a) We have sought and obtained all the information and explanationswhich 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 Balance Sheet, the Statement of Profit and Loss, Statement of Changes in Equity and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specifiedunder Section 133 of the Act.

e) On the basis of the written representationsreceived from the Directors as on 31 March, 2023 taken on record by the Board of Directors, none of the Directors is disqualified as on 31 March, 2023 from being appointed as a Director in terms of Section of the Act. 164(2)

f) With respect to the adequacy of the Internal financial controls with reference to financial Company and the operating refer to our separate Report in ‘Annexure B.

g) With respect to the matter to be included in the Auditors Report under Section197(16), In our opinion and according to the information and explanations given to us, the remuneration during the current year is in accordance with the provisions of Section 197 of the Act. The remuneration director is not in excess of the limit laid down under Section significantdeficiencies 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section required to be commented upon by us.

h) 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

i. The Company has disclosed pending litigations and the impact on its financial position financial statements - Refer Note 46 to the Financial Statements.

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses. theAct, we report that: iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

iv. The dividend declared or paid during the year by the Company is in accordance with section 123 of the Act.

v. (a) The Management has represented that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts to the standalone financial been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities(“Intermediaries”), understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company (“Ultimate

Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(b) The Management has represented, that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entitiesidentified by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

(c) Based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations Rule 11(e), as provided under (a) and (b) above, contain any material mis-statement.

For SAKSHI & ASSOCIATES
Chartered Accountants
Firms Registration

SAKSHI KHARABANDA

Proprietor
Place : New Delhi M.No.:523802
Date : 29 May 2023 UDIN:23523802BGUWGU1157

Annexure ‘A to the Independent Auditors Report

(The Annexure referred to in Paragraph 1 under ‘Report on Other Legal and Regulatory Requirements section of our report of even

To the best of our information and according to the explanations provided to us by the Company and the books of account and records examined by us in the normal course of audit, we state that: (i) In respect of the Companys property, plant and equipment, right-of-use assets and intangible assets:

(a) (A) The Company has maintained proper records showing full particulars, quantitative details and situation of plant and equipmentandrelevant details institutions on of right-of-use assets,

(B) The Company has maintained proper records showing full particulars of intangible assets;

(b) According to the information and explanations given to us and on the basis of our examination the records of the Company, the Property, Plant and Equipment have been physically verified by the Management at reasonable intervals; no material discrepancies were noticed on such

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of all the immovable properties (other than properties where the Company is the lessee and the lease agreements are duly executed in favour of the lessee) disclosed in the financial statements held in the name of the Company.

(d) The Company has not revalued its Property, Plant and Equipment (including Right of Use assets) or Intangible assets during the year.Accordingly, the reporting applicable to the Company.

(e) No proceedings have been initiated or are pending against the Company as at March 31, 2023, for holding any benami property under the Benami Transactions and rules made thereunder.

(ii) (a) As explained to us & on the basis of the recordsexaminedby us,in ouropinion, physical According to the information verification of at reasonable intervals by the Management during the year. In our opinion, the coverage and procedure of such verification followed by the Management were appropriate. No discrepancy of 10% or more in the aggregate for each class of inventory were noticed on physical of stocks by the Management as compared to book records.

including (b) The Company has been sanctioned working capital limits in excess of five crore rupees, in aggregate, from banks or financial the basis of security of current assets during any point of time of the year. The quarterly returns or statements filed by the Company with such banks or financial institutions are in agreement with the books of account of the Company.

(iii) The Company has not made investments in, nor of provided any guarantee or security or granted any loans or advances in the nature of loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or any other parties during the year. Accordingly, provisions of clause 3(iii)(a), 3(iii)(b), 3(iii) (c), 3(iii)(d), 3(iii)(e) and 3(iii)(f) of the Order are not applicable to the Company.

(iv) In respect of loans, investments, guarantees, and security, provisions of Section Companies Act, 2013 have been complied with.

(v) The Company has not accepted any deposits or amounts which are deemed to be deposits covered under Sections 73 to 76 of the Companies Act, 2013. Accordingly, clause 3(v) of the Order is not applicable.

(vi) The maintenance of cost records has been specified by the Central Governmentundersub-section(1) of underClause3(i)(d) of the Order is not section 148 of the Companies Act and such accounts and records have been so made and maintained;

(vii) (a) The Company is regular in depositingundisputed statutory dues including Goods and Services Tax, provident fund, employees state insurance, Act,1988(45of1988) income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues to the appropriate authorities. inventory has and explanation given to us there were no been conducted outstanding statutory dues as on 31st of March, 2023 for a period of more than six months from the date they became payable.

(b) There are no statutory dues referred to in sub-clause (a) that have not been deposited on account of any dispute except the following:

S.No

Name of Statute

Description

As at As at
31st March 2023 31st March 2022

1

Central Excise Act, 1944

Demand for Excise Duty before Add. Comm. LTU, New Delhi for 2008-09

16.40 16.40

2

Central Excise Act, 1944

Demand for Excise Duty before Comm. (A), New Delhi for 2009-10 to 2015-16.

82.49 82.49

3

Finance Act, 1994

Demand for Service Tax Credit before Commissioner Appeal, LTU, Delhi for 2012-13

1.01 1.01

4

Finance Act, 1994

Demand for Cenvat Credit before Commissioner Appeal, LTU, Delhi for 2011-12

1.13 1.13

5

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Chandigarh for 2008-09

25.51 25.51

6

Haryana Vat Act, 2003

Demand for Sales Tax before Joint Comm., (Appeal), Rohtak for 2010-11

17.83 17.83

7

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Chandigarh for 2009-10

4.78 4.78

8

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Rohtak for 2011-12

18.45 18.45

9

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Rohtak for 2012-13

10.06 10.06

10

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Rohtak for 2010-11

49.22 49.22

11

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Chandigarh for 2011-12

23.19 23.19

12

Haryana Vat Act, 2003

Demand for Sales Tax before Joint Comm., (Appeal), Ambala for 2011-12

4.38 4.38

13

Finance Act, 1994

Show cause notice received towards short payment of Service Tax for 2010-11 to 2014-15

163.04 163.04

14

Employees Provident Fund Act, 1952

Demand for EPF before EPF appellate, Tribunal, New Delhi.

8.87 8.87

15

Haryana Vat Act, 2003

Demand for sales tax before Haryana Tax Tribunal for 2011-12

23.39 23.39

16

Haryana Vat Act, 2003

Demand for sales tax before Haryana Tax Tribunal for 2012-13

23.67 23.67

17

Haryana Vat Act, 2003

Demand for sales tax before Haryana Tax Tribunal for 2013-14

80.59 80.59

18

Haryana Vat Act, 2003

Demand for sales tax before Jt. Commissioner (A), Rohtak for 2013-14

4.80 72.95

19

Haryana Vat Act, 2003

Demand for sales tax before Jt. Commissioner (A), Rohtak for 2014-15

12.05 25.35

20

Haryana Vat Act, 2003

Demand for sales tax before Jt. Commissioner (A), Rohtak for 2013-14

18.38 18.38

 

21

Haryana Vat Act, 2003

Haryana Tax Tribunal, Chandigarh-Final demand after Rectification on 31.07.2017 (Revision Pending)

3.61 3.61

22

Haryana Vat Act, 2003

Haryana Tax Tribunal, Chandigarh-Pending for Rectification for 2012-13

1.97 1.97

23

Haryana Vat Act, 2003

Haryana Tax Tribunal, Chandigarh-Pending for Rectification for 2013-14

3.73 3.73

24

Haryana Vat Act, 2003

Haryana Tax Tribunal, Chandigarh-Pending for Rectification for 2014-15

0.52 0.52

25

Haryana Vat Act, 2003

Haryana Tax Tribunal-Rohtak-Appeal pending before the Jt. ETC(A), Rohtak for 2010-11

33.95 33.95

26

Haryana Vat Act, 2003

Demand for sales tax before Dy. Excise & Taxation Commissioner (ST),Sonepat for 2014- 15

10.14 10.14

27

Haryana Vat Act, 2003

Demand for sales tax before Jt Excise & Taxation Commissioner, Ambala for 2014-15

55.74 55.74

28

Income Tax Act, 1961

Income Tax demand before Asstt. Commissioner of Income Tax, Delhi for AY-2017-18

28.72 28.72

29

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Rohtak for 2015-16

41.89 41.89

30

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Rohtak for 2014-15

97.13 97.13

31

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Rohtak for 2015-16

75.76 75.76

32

Central Excise Act, 1944

Demand for Excise Duty before Deputy Comm. Central GST Gurgram for 2016-17.

1.72 1.72

33

Finance Act, 1994

Demand for Service Tax Credit before Asstt. Commissioner Gurugram for 2015-16 to 2017- 18

14.78 14.78

34

Custom Act,1962

Demand for Custom Duty before Adl./Joint Comm./Customs Gr-VA,ACC Import New Custom House New Delhi for 2018-19

22.67 22.67

35

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Rohtak for 2016-17

73.54 73.54

36

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Rohtak for 2016-17

37.23 37.23

37

Haryana Vat Act, 2003

Demand for Sales Tax before Haryana Tax, Tribunal, Rohtak for 2017-18

68.87 68.87

38

CGST Act, 2017

Asst. Commissioner CGST division, Parwanoo, Jabli

4.33 -

(viii) The Company has not surrendered or disclosedanytransactions,previously unrecorded as income in the books of account, in the tax assessments under the Income Tax Act, 1961 as income during the year.

(ix) (a) The Company has not defaulted in repayment of loans or other borrowings or in the payment of interest thereon to any lender.

(b) The Company has not been declared as a willful defaulter by any bank or financial institution or other lender;

(c) According to the information and explanations given to us by the management, the Company has utilized the money obtained by way of term loans during the year for the purposes for which they were obtained.

(d) According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company, we report that no funds raised on short-term basis have been used for long term purposes by the Company.

(e) In our opinion and according to the information and explanationsgiven by the Management, the Company has not taken any funds from any entity or person on account of or to meet the obligations of its subsidiaries, associates or joint ventures. Accordingly, clause 3(ix)(e) is not applicable.

(f) The Company has not raised loans during the year on the pledge of securities held in its subsidiaries, joint ventures or associate companies. Accordingly, clause 3(ix)(f) is not applicable.

(x) (a) The Company has not raised any money by way of initial (including debt instruments) during the year. Accordingly, clause 3(x)(a) of the Order is not applicable.

(b) The Company has not made any preferential allotment or private placement of shares partially or convertibledebentures (fully, or Accordingly, clause 3(x)(b) of the Order is not applicable. te of Registration (CoR) from the (xi) (a) Based on examination of the books and records of the Company and according to the information and explanations given to us, no fraud by theCompany or any fraud on the Company has been noticed or reported during the course of audit.

(b) No report section(12) of section under sub- made by 143 of the CompaniesActhasbeenfiledby the auditors in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government;

(c) According to the informationand explanations given to us by the management, no whistle-blower complaints had been received by the Company.

(xii) The Company is not a Nidhi Company. Accordingly, clause 3(xii)(a), 3(xii)(b) and 3(xii)(c) of the Order is not applicable.

(xiii) In our opinion and according to the information and explanations given to us, all transactions with the related partiesare in compliance with Sections 177 and 188 of Companies Act, where applicable and the details have been disclosed in the financial statements, as required by the applicable accounting standards.

(xiv) (a) Based on information and explanations provided to us and our audit procedures, the Company has an internal audit system commensurate with the size and nature of its business.

(b) We have considered the Internal audit reports of the Company issued till date for the period under audit.

(xv) In our opinion and according to the information and explanations given to us, the Company has not entered into any non-cash transactions with Directors or persons connected with him and hence, provisions ofSection192 of the Companies Act, 2013 are not applicable to the Company.

(xvi) (a) In our Opinion and based on our examination, the Company is not required to be registered undersection45-IA of the Reserve Bank of India Act, 1934 (2 of 1934). Accordingly, clause 3(xvi) (a) of the Order is not applicable.

(b) In our Opinion and based on our examination, the Company has not conducted any Non-Banking Financial or Housing Finance avalid Reserve Bank of India as per the Reserve Bank of India Act, 1934. Accordingly, clause 3(xvi)(b) of the Order is not applicable.

(c) In our Opinion and based on our examination, the Company is not a Core Investment Company inthe regulationsthe (CIC)as defined Reserve Bank of India. Accordingly, clause 3(xvi) (c) of the Order is not applicable.

(d) According to the informationand explanations given by the Management, the Group does not have any Core Investment Companies (CIC) as part of the Group.

(xvii) Based on our examination, the Company has incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

(xviii) There has been no resignation of the statutory auditors during the year. Accordingly, clause 3(xviii) of the Order is not applicable.

(xix) On the basis of the financial expected dates of realisation of financialassets and liabilities, other information payment of financial accompanying the financial our knowledge of the Board of Directors and Management plans and based on our examination of the evidence supporting the assumptions, has come to our attention, which causes us to believe that any material uncertainty exists as on the date of the audit report that Company is not capable of existing meeting its liabilities sheet as and when they fall due within a period of one year from the Balance sheet date. We, however, state that this is not an assurance as to the future viability of the Company. We further state that our reportingis based on the facts up to the date of the audit report and we neither give any guarantee nor any assurancethat liabilitiesfalling due within a period of one year from the balance sheet date, will get discharged by the Company as and when they fall due.

(xx) There is no unspentamountundersub-section(5) of

Section 135 of the any project. Accordingly, clause 3(xx)(a) and 3(xx)(b) of the order are not applicable to the Company.

(xxi) The reporting under clause ratios, 3(xxi) of the ageing and order applicable in respect of audit of standalone financial statements. Accordingly, no comment in respect of the said clause has been included in this report. statements

For SAKSHI & ASSOCIATES
Chartered Accountants
Firms Registration

SAKSHI KHARABANDA

Proprietor
Place : New Delhi M.No.:523802
Date : 29 May 2023 UDIN:23523802BGUWGU1157

Annexure‘B to the Independent Auditors Report

Report on Internal Financial Controls with reference to Standalone Financial statements

Report on the Internal Financial Controls under Clause (i) of Subsection 3 of Section 143 oftheCompaniesAct,2013(“theAct”) reporting and the preparation of We have audited the Internal financial controls over financial reporting of HPL ELECTRIC & POWER LIMITED (“the Company”) as of March 31, 2023 in conjunction with our audit of the financial statements of the Company fortheyearendedonthatdate. tements includes those policies andsta

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 considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued the Accountants of India (“ICAI”). These responsibilities design, implementation and maintenance of adequate internal financial orderly and efficient conduct of its business, includingadherenceto of use, or disposition Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors,theaccuracyandcompleteness tements. of the accounting records, and the timely preparation of reliable as required under the Act. financial

Auditors Responsibility

Our responsibility is to express an opinion on the Companys Internal financial controls over financial reporting conducted our audit in accordance with the Guidance Note on

Audit of Internal Financial Controls Over Financial Reporting “Guidance Note”) andtheStandardsonAuditing,issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of Internal financial controls with reference to standalone financial 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 reportingwas established and maintained and if such controls operated effectively in all material respects. Ourauditinvolvesperformingprocedures to obtain audit evidence were operating effectively controlsoverfinancialreporting about the adequacy of the Internal financialcontrols system over financial reporting criteria established by the Internal financial controls over financial an understanding of Internal financialcontrols over financial reporting, assessing the testing and evaluating the design and 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 financialstatements, 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 financialcontrols system over financial reporting with reference to standalone financial statements.

Meaning of Internal Financial Controls Over Financial Reporting reportingACompanysInternalfinancial is a statements

process designed to provide reasonable assurance regarding the reliability of financial statements for external purposes in accordance with generally accepted Accountingprinciples. A Companys Internal financial control over financial reporting with financial that:

1. Pertain to the maintenance of records that, in reasonable detail, accuratelyandfairlyreflectthetransactionsanddispositionsof the assets of the Company;

2. Provide reasonable reporting assurance that transactions are recorded criteria as necessary to permit preparation of financial statements in accordance with generally accepted Accounting by the that receipts and expenditures of the Company are being made Institute of Chartered only in accordance with authorisationsof Management and Directors of the Company; and

3. Provide reasonable assurance regarding prevention or timely controlsthatwereoperating effectivelyforensuringthe detection of unauthorized acquisition, the Companys assets that could have a material effect on the financial

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financialcontrols over financialreporting,including the possibility of collusion or improper management override of controls, material misstatements due to basedonouraudit. We error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial (the reporting to future periods are subject to the risk that the internal financialcontrol over financialreportingmay become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. statements. Those

Opinion

In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financialcontrols system over financialreporting with reference to standalone financial statements and such internal financial as at March 31 2023, based on the reporting and their operating effectiveness. Our audit of Internal control over financial reporting included obtaining Company considering the essential components of Internal control stated in the Guidance Note on Audit of Internal Financial Controls that a material weakness exists, and Over Financial Reporting issued by the Institute of Chartered effectiveness of Accountants of India.

For SAKSHI & ASSOCIATES
Chartered Accountants
Firms Registration

SAKSHI KHARABANDA

Proprietor
Place : New Delhi M.No.:523802
Date : 29 May 2023 UDIN:23523802BGUWGU1157