KBC Global Ltd Auditor Reports

To The Members of KBC Global Limited

(Earlier known as Karda Constructions Limited)

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the standalone financial statements of KBC Global Limited ("the Company"), which comprise the standalone balance sheet as at 31 March 2024, 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 ended on that date, 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 ("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 2024, and its profit (including 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 obtained by us is sufficient and appropriate to provide a basis for our opinion on the standalone financial statements.

Material Uncertainty Relating to Going Concern

The company is incurring continuous huge losses and most of the companys construction sites are not operational which raises concern about the companys ability to generate sufficient cashflows to meet the ongoing obligations. Also, the Company have made various violations as per Foreign Exchange Management Act ("FEMA"), 1999 and the company has attempted to remedy these violations by submitting the compounding application. As informed by the management the said application has been rejected by the RBI and the company is currently in the process of resubmitting the compounding application to the RBI as of the date of this report. These events or conditions, along with other matters indicate that a material uncertainty exists that may cast significant doubt on the companys ability to continue as a going concern. However, management asserts that these losses can be recovered and the aforementioned violations will be compounded in due course of time.

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.

The Key Audit Matter	How the matter was addressed in our audit
1. Accuracy of revenue recognition, measurement, presentation and disclosures as per Ind AS 115 "Revenue from Contracts with Customers".
Measurement of revenue recorded over time which is dependent on the estimates of the costs to complete	Principle Audit Procedures
	• Evaluating that the Companys revenue recognition accounting policies are in line with the applicable accounting standards;
Revenue recognition involves significant estimates related to measurement of costs to complete for the projects. Revenue from projects is recorded based on the Companys assessment of the work completed, costs incurred and accrued and the estimate of the balance costs to complete.
	• Obtaining and understanding revenue recognition process including identification of performance obligations and determination of transfer of control of the asset underlying the performance obligation to the customer;
Considering the significant estimate involved in measurement of revenue, we have considered measurement of revenue as a key audit matter.
	• Identifying and testing operating effectiveness of key controls around approvals of contracts, milestone billing, intimation of possession letters / intimation of receipt of occupation certificate and controls over collection from customers;
Due to the inherent nature of the projects and significant judgment involved in the estimate of costs to complete, there is risk of overstatement or understatement of revenue.
	• Identifying and testing operating effectiveness of key controls over recording of project costs;
	• Comparing the costs to complete workings with the budgeted costs and inquiring for variance;
	• Comparison of the estimated costs with the costing details as mentioned for registration of the projects with the Maha RERA website.

2. Valuation of Inventories - Assessing the net realisable value
Inventory represents the capitalized project costs to date less amounts expensed on sales by reference to the aforementioned projections. It is held at the lower of cost and net realisable value (NRV), the latter also being based on the forecast for the project. As such inappropriate assumptions in these forecasts can impact the assessment of the carrying value of inventories.	Principle Audit Procedures
	• Discussion with the management to understand the basis of calculation and justification for the estimated recoverable amounts of the unsold units ("the NRV assessment");
	• Evaluating the design and implementation of the Companys internal controls over the NRV assessment. Our evaluation included assessing whether the NRV assessment was prepared and updated by appropriate personnel of the Company and whether the key estimates, including estimated future selling prices and costs of completion for all property development projects, used in the NRV assessment, were discussed and challenged by management as appropriate;
	• Evaluating the managements valuation methodology and assessing the key estimates, data inputs and assumptions adopted in the valuations, which included comparing expected future average selling prices with available market data such as recently transacted prices for similar properties located in the nearby vicinity of each property development project and the sales budget plans maintained by the Company;

3. Tax Assessments
Review, effect and presentation of completed tax assessments	Principle Audit Procedures
	• Verification of details of completed tax assessments and demands as at 31 March 2024, followed by verification of tax refunds on completed tax assessments and treatment of the same in books of account and financial statements.

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 standalone financial statements and our auditors report thereon.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information; we are required to report that fact. We have nothing to report in this regard.

Managements Responsibility for the Standalone Financial Statements

The Companys Management and Board of Directors are responsible for the matters stated in 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/loss and other comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone financial statements, management and Board of Directors are responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

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 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 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 standalone financial statements in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Management and Board of Directors.

• Conclude on the appropriateness of managements use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companys ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• 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.

Other Matters

1. During the period ending March 31, 2023, the Company has issued 950 Foreign Currency Convertible Bonds ("FCCB") of face value of USD 1,00,000 each amounting to face value of USD $95.00 million at 1.50% Coupon Rate at a discount of 15.00% and the Company raised USD 80.62 million (Net of 15% discount) i.e. on November 21, 2022. These FCCBs are listed on AFRINEX Exchange (Mauritius). Maturity tenure of these FCCBs is 37 months and is convertible into listed Equity Shares at the option of the holder of the FCCBs. In the current reporting period 130 FCCBs have been converted into equity apart from 21 FCCBs converted in the last quarter ending March 31, 2023.
2. During the course of these transactions, the Company have made certain violations as per Foreign Exchange Management Act ("FEMA"), 1999, Foreign Exchange Management (Borrowing and Lending) Regulation, 2018, Foreign Exchange Management (Transfer or issue of security by a person resident Outside India) Regulations, 2017 and FEMA Regulations, as amended from time to time. These violations include violations with respect to end use & deployment of funds borrowed in the form of External Commercial Borrowings ("ECB") and delay & erroneous reporting of respective forms under above mentioned Regulations and the Rules.
3. The Company has attempted to remedy the violations. Further, the Company has filed a Compounding Application on May 8, 2023 to the Reserve Bank of India ("RBI") in the aforesaid matter which was further resubmitted on July 6, 2023. As informed by the management the said application has been rejected by the RBI and the company is currently in the process of resubmitting the compounding application to the RBI as of the date of this review report. Financial implications cannot be quantified till the Compounding process is completed which may lead to additional liability on the Company.
4. As per information received from the management, the company has provided the Corporate Guarantee in respect of the loans taken by Shree Sainath Land & Development (India) Private Limited from LIC Housing Finance Limited. However, the said loan has become NPA now and the borrower has received demand notice u/s 13(2) of the Sarfaesi Act, 2002. Also, the said company has been going under the Corporate Insolvency Resolution Process (CIRP) after the admission of application by honorable court on 20th October 2023. Accordingly, corporate guarantee given by the company for such loan can be invoked which may lead to additional liability on the company. The company holds only 15% stake in Shree Sainath Land & Development (India) Private Limited.
5. There was considerable delay in repayment of the borrowings from the financial institutions and banks. During the review period, the company has not repaid the principal component of such borrowings.
6. The company has been irregular in the payment of statutory dues to government authorities. Notably, outstanding dues for Income Tax, GST, and TDS have remained unpaid for a period exceeding one year. This non-compliance raises additional concerns about the companys financial health and its ability to manage statutory obligations.
7. The Company has not filed GST returns during the current reporting period and the GST registration number of the company has been cancelled w.e.f. 01/12/2022.
8. The interest on the various loan accounts has been recorded on a provisional basis due to their classification as Non- Performing Assets (NPA), and as a result of this NPA classification, the statements for these accounts were not accessible.
9. The company is incurring continuous huge losses and most of the companys construction sites are not operational which raises concern about the companys ability to generate sufficient cashflows to meet the ongoing obligations. Also, the Company have made various violations as per Foreign Exchange Management Act ("FEMA"), 1999 and the company has attempted to remedy these violations by submitting the compounding application which is yet pending with the RBI since long time. These events or conditions, along with other matters indicate that a material uncertainty exists that may cast significant doubt on the companys ability to continue as a going concern. However, management asserts that these losses can be recovered and the aforementioned violations will be compounded in due course of time.

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 Act, 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, to the extent applicable.
2. As required by Section 143(3) of the Act, based on our audit we report that:
1. 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.
2. 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.
3. 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.
4. In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act.
5. On the basis of the written representations received from the directors as on 31 March 2024 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2024 from being appointed as a director in terms of Section 164(2) of the Act.
6. 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" to this report.
7. 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:
1. The Company has disclosed the impact of pending litigations as at 31 March 2024 on its financial position in its standalone financial statements - Refer Note 51 to the standalone financial statements.
2. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
3. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company;
4. (a) The management has represented that, to the best of its knowledge and belief, no funds have 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 persons or entities, including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

1. The management has represented that, to the best of its knowledge and belief, no funds have been received by the Company from any persons or entities, 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 entities identified in any manner whatsoever 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

2. Based on such audit procedures as considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub clause (i) and (ii) of Rule 11(e) of the Companies (Audit and Auditors) Rules, 2014 contain any material misstatement.

1. The Company has neither declared nor paid any dividend during the year.
2. Proviso to Rule 3(1) of the Companies (Accounts) Rues, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company with effect from 1^st April 2023 and accordingly, reporting under Rule 11(g) of The Companies (Audit and Auditors) Rules, 2014 is applicable for the financial year ended 31^st March 2024. The accounting software used by the company has no feature of audit trail.

1. With respect to the matter to be included in the Auditors Report under Section 197(16) of the Act:

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) of the Act which are required to be commented upon by us.

For Sharp Aarth & Co LLP

Chartered Accountants

Firm Registration No – 132748W / W-100823

CA Praveen Purohit

Partner

Membership No.429231

UDIN: 24429231BKDZMC4268

Place: Nashik Date: 15 July, 2024

Annexure "A" to the Independent Auditors Report on Standalone Financial Statements of KBC Global Limited for the year ended 31 March 2024

(Referred to in paragraph 1 under "Report on Other Legal and Regulatory Requirements" section of our report of even date)

In terms of the information and explanations sought by us and given by the company and the books of account and records examined by us in the normal course of audit and to the best of our knowledge and belief, we state that:

1. Property, Plant and Equipments
1. The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets including property, plant and equipment and investment properties and investment property under construction.
2. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has a regular programme of physical verification of its Property, Plant and Equipment by which all property, plant and equipment including investment properties are verified in a phased manner over a period of three years. However, during the course of our audit, we noted that the management did not conduct any physical verification of PPE during the year. Consequently, we are unable to determine whether there were any material discrepancies in the PPE records that should have been reflected in the financial statements.
3. 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 immovable properties (other than immovable properties where the Company is the lessee and the leases agreements are duly executed in favour of the lessee) are held in the name of the Company.
4. The Company has not revalued its Property, Plant and Equipment (including Right of use assets) or intangible assets during the year.
5. According to information and explanations given to us and on the basis of our examination of the records of the Company, there are no proceedings initiated or pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.
2. In respect of Inventories
1. The inventory, comprising of raw materials and finished goods, has not been physically verified by the management during the year. In respect of stocks lying with third parties at the year end, written confirmations have been obtained. During the course of our audit, we noted that the management did not conduct any physical verification of inventory during the year. Consequently, we are unable to determine whether any discrepancies of 10% or more in the aggregate for each class of inventory were noticed and properly dealt with in the books of account. The Companys inventory also includes construction work in progress and entitlement to Transferable Development Rights, to which the requirements under paragraph 3(ii) of the Order are not applicable.
2. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has been sanctioned working capital limits in excess of five crores rupees, in aggregate, from banks on the basis of security of current assets. In our opinion, the quarterly returns or statements filed by the Company with such banks are not in agreement with the books of account of the Company.
3. Loans granted
1. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has made investments, granted loans and advances in the nature of loans, secured or unsecured to companies, limited liability partnership and other parties in respect of which the requisite information is as below. The Company has also provided the corporate guarantee to other company during the year.

(INR in Lakhs)

Particulars	Guarantees	Security	Loans	Advances in nature of loans
Aggregate amount during the year
- Subsidiaries			-
- Joint Ventures			-
- Associates			-
- Others	9,851.82		-
Balance outstanding as at balance sheet date

- Subsidiaries			67,218.02
- Joint Ventures			-
- Associates			-
- Others	-		-

The Company has not provided any security or advances in the nature of loans to any other entity during the year.

2. According to the information and explanations given to us and based on the audit procedures conducted by us, as the loan agreement has not been executed between the company and its subsidiary, we are not able to comment on the clause of terms and conditions of the grant of loans and guarantees provided during the year. Also, as the loan in respect of which the company has paid the corporate guarantee to the other party, has become NPA during the year, thus in our opinion the guarantees provided are, prima facie, prejudicial to the interest of the Company.
3. According to the information and explanations given to us and based on the audit procedures conducted by us, in our opinion as the loan agreement has not been executed between the company and its subsidiary, we are not able to comment on this clause.
4. According to the information and explanations given to us and based on the audit procedures conducted by us, in our opinion, since the loan agreement has not been executed between the company and its subsidiary and as there is no schedule for repayment has been so prescribed, therefore, we are not able to comment on this clause.
5. According to the information and explanations given to us and based on the audit procedures conducted by us, in our opinion, since the loan agreement has not been executed between the company and its subsidiary and as there is no schedule for repayment has been so prescribed, therefore, we are not able to comment on this clause.
6. According to the information and explanations given to us and based on the audit procedures conducted by us, in our opinion, since the loan agreement has not been executed between the company and its subsidiary and as there is no schedule for repayment has been so prescribed, therefore, we are not able to comment on this clause.
4. Loans, Investments, Guarantees and Security

According to the information and explanations given to us and on the basis of our examination of records of the Company, the company has complied with the provisions of Section 185 and 186 of the Companies Act, 2013 ("the Act") with respect of investments made and loans, guarantees provided by the Company. The Company has not provided any security in connection with a loan to any other body corporate or person and accordingly, compliance under Sections 185 and 186 of the Act in respect of providing securities is not applicable to the Company.

5. Deposits

The Company has not accepted any deposits or amounts which are deemed to be deposits from the public.

Accordingly, clause 3(v) of the Order is not applicable

6. Cost records

We have broadly reviewed the books of accounts maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under Section 148(1) of the Act and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not carried out a detailed examination of the records with a view to determine whether these are accurate or complete.

1. Statutory Dues
1. According to the information and explanations given to us and on the basis of our examination of records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident fund, Employees State Insurance, Goods and Service tax, Labour cess, Professional tax, Property tax, Cess and other material statutory dues have not been regularly deposited during the year by the Company with the appropriate authorities. Amounts deducted / accrued in the books of account in respect of undisputed statutory dues of Income tax have not been regularly deposited during the year by the Company with the appropriate authorities, though there have been slight delays in a few cases. As explained to us, the Company did not have any dues on account of wealth tax.
2. According to the information and explanations given to us, undisputed amounts payable in respect of Provident fund, Employees State Insurance, Profession tax, Property tax, Labour cess, Income-tax, Goods and Service tax, Cess and other material statutory dues were in arrears as at 31 March 2024 for a period of more than six months from the date they became payable consists of:

Sr. No.	Tax Payable	Amount (Rs. in Lakhs)
1	Provision for Income Tax (Gross)	977.16
2	TDS / TCS Payable	443.80
3	ESIC, PF, PT Payable	21.13

1. According to the information and explanations given to us, there are no dues of Income-tax, Sales tax, Service tax, Value added tax and Goods and Service tax as at 31 March 2024, which have not been deposited with the appropriate authorities on account of any dispute, except as stated below:

(INR in Lakhs)

Name of the statute	Nature of the dues	Period to which the amount relates	Demand Amount	Amount Paid	Forum where dispute is pending
Income Tax Act, 1961	Income Tax	A Y 2014-15	1.50	1.50	Income Tax Appellate Tribunal (ITAT)
Income Tax Act, 1961	Income Tax	A Y 2015-16	36.13	36.13
Income Tax Act, 1961	Income Tax	A Y 2015-16	16.39	-	CIT (Appeals)

2. Undisclosed Income

According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not surrendered or disclosed any transactions, previously unrecorded as income in the books of account, in the tax assessments under the Income Tax Act, 1961 as income during the year. Accordingly, the requirement to report on clause 3(viii) of the Order is not applicable to the Company.

3. Repayment of Loans and Borrowings
1. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has defaulted in repayment of loans and borrowing or in the payment of interest thereon as reported below:

(INR in Lakhs)

Nature of Borrowings, including Debt Securities	Name of Lender	Amount not paid on due date	Whether principal or interest	No. of days delay or unpaid
Term Loan	Capri Global Capital Limited	1,517.92	Both	0
Term Loan	LIC Housing Finance Ltd	1,629.31	Both	639
Term Loan	Shri Sai Samarth Nagari Sahari Pathsanstha	76.56	Interest	244
Term Loan	Tata Capital Housing Finance Ltd	72.09	Both	91
Term Loan	Tata Capital Housing Finance Ltd	625.72	Both	547
Term Loan	Tata Capital Housing Finance Ltd	444.82	Both	31
Term Loan	Tata Capital Housing Finance Ltd	376.17	Both	31
Term Loan	Tata Capital Housing Finance Ltd	566.95	Both	365
Term Loan	The Nashik Road Deolali Vyapari Sahakari Bank	39.81	Both	365
Term Loan	The Nashik Road Deolali Vyapari Sahakari Bank	251.68	Both	244
Term Loan	The Nashik Road Deolali Vyapari Sahakari Bank	251.70	Both	365
Cash Credit	Canara Bank	1,057.82	Both	183
Cash Credit	Central Bank of India	388.62	Both	60
Cash Credit	The Nashik Road Deolali Vyapari Sahakari Bank	248.27	Both	365

1. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not been declared a wilful defaulter by any bank or financial institution or government or government authority.
2. In our opinion and according to the information and explanations given to us by the management, we were not able to verify whether the term loans were applied for the purpose for which the loans were obtained.
3. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we were not able to report that whether funds raised on short-term basis by the company have been used for long-term purposes or not.
4. According to the information and explanations given to us and on an overall examination of the standalone financial statements of the Company, we report that 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 as defined under the Act.
5. According to the information and explanations given to us and procedures performed by us, we report that the Company has not raised loans during the year on the pledge of securities held in its subsidiaries, joint ventures or associate companies as defined under the Act.
4. Initial Public Offer/ Further Public Offer
1. During the period ending March 31, 2023, the Company has issued 950 Foreign Currency Convertible Bonds ("FCCB") of face value of USD 1,00,000 each amounting to face value of USD $95.00 million at 1.50% Coupon Rate at a discount of 15.00% and the Company raised USD 80.62 million (Net of 15% discount) i.e.

on November 21, 2022. These FCCBs are listed on AFRINEX Exchange (Mauritius). Maturity tenure of these FCCBs is 37 months and is convertible into listed Equity Shares at the option of the holder of the FCCBs. The 151 bonds are converted upto the end of financial year i.e 31^st March 2024.

1. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has made a preferential allotment of equity shares during the year. The requirements of Section 42 and Section 62 of the Companies Act, 2013, in respect of the preferential allotment of equity shares have been complied with and the funds raised have been used for the purposes for which the funds were raised.
5. Fraud
1. Based on examination of the books and records of the Company and according to the information and explanations given to us, no fraud by the Company or on the Company has been noticed or reported during the course of the audit.
2. According to the information and explanations given to us, no report under sub-section (12) of Section 143 of the Act has been filed by the auditors in Form ADT-4 as prescribed under Rule 13 of the Companies (Audit and Auditors) Rules, 2014 with the Central Government.
3. As represented to us by the management, there are no whistle blower complaints received by the Company during the year.
6. Nidhi Company

According to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, clause 3(xii) a to c of the Order is not applicable.

7. Related Party Transactions

In our opinion and according to the information and explanations given to us, the transactions with related parties are in compliance with Section 177 and 188 of the Act, where applicable, and the details of the related party transactions have been disclosed in the standalone financial statements as required by the applicable accounting standards.

8. Internal Audit System
1. Based on information and explanations provided to us and our audit procedures, in our opinion, the Company has an internal audit system commensurate with the size and nature of its business.
2. During the course of our audit, we requested the internal audit reports for the period under audit; however, the management did not provide any such reports. Consequently, we were unable to consider the internal audit reports in our audit procedures, which may have impacted the scope and the conclusions of our audit.
9. Non-cash transactions with Directors

In our opinion and according to the information and explanations given to us, the Company has not entered into any non-cash transactions with its directors or persons connected to its directors and hence, provisions of Section 192 of the Act are not applicable to the Company.

10. Registration under 45-IA of Reserve Bank of India Act, 1934
1. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, clause 3(xvi)(a) of the Order is not applicable.
1. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, clause 3(xvi)(b) of the Order is not applicable.
2. The Company is not a Core Investment Company (CIC) as defined in the regulations made by the Reserve Bank of India. Accordingly, clause 3(xvi)(c) of the Order is not applicable.
3. The Company is not part of any group as per the provisions of the Core Investment Companies (Reserve Bank) Directions, 2016, as amended. Accordingly, the requirements of clause 3 (xvi) (d) are not applicable.
11. Cash Losses

The Company has not incurred cash losses in the current and in the immediately preceding financial year.

12. Resignation of Statutory Auditor

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

13. Material uncertainty on meeting liabilities

According to the information and explanations given to us and on the basis of the financial ratios, ageing and expected dates of realisation of financial assets and payment of financial liabilities, other information accompanying the standalone financial statements, our knowledge of the Board of Directors and management plans and based on our examination of the evidence supporting the assumptions, nothing has come to our attention, which causes us to believe that any material uncertainty exists as on the date of the audit report that the Company is not capable of meeting its liabilities existing at the date of balance 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 reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date, will get discharged by the Company as and when they fall due.

14. Corporate Social Responsibility

In our opinion and according to the information and explanations given to us, the company has spent Rs. 1.30 Lakhs as a CSR expenditure which is lower of 2% of average net profit of the company for the preceding 3 years. Accordingly, there is unspent CSR amount of ? 23.34 Lakhs which is to be transferred to a Fund specified in Schedule VII to the Act.

15. Consolidated Financial Statements

According to the information and explanations given to us and based on the reports issued by the auditors of the respective subsidiary included in the consolidated financial statements of the Company, to which reporting on matters specified in paragraph 3 and 4 of the Order is applicable, provided to us by the Management of the Company, we have not identified any qualifications or adverse remarks made by the auditors in their report on matters specified in paragraphs 3 and 4 of the Order.

For Sharp Aarth & Co LLP

Chartered Accountants

Firm Registration No – 132748W / W-100823

CA Praveen Purohit

Partner

Membership No.429231

UDIN: 24429231BKDZMC4268

Place: Nashik Date: 15 July, 2024

Annexure B to the Independent Auditors report on the Standalone Financial Statements of KBC Global Limited for the period ended 31 March 2024.

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

(Referred to in paragraph 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 KBC Global Limited ("the Company") as of 31 March 2024 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 2024, 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 judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companys internal financial controls with reference to standalone financial statements.

Meaning of Internal Financial Controls with reference to Standalone Financial Statements

A companys internal financial controls with reference to standalone financial statements is a process designed to provide

reasonable assurance regarding the reliability of financial reporting and the preparation of standalone financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial controls with reference to standalone financial statements include those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of standalone financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companys assets that could have a material effect on the standalone financial statements.

Inherent Limitations of Internal Financial Controls with reference to Standalone Financial Statements

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

For Sharp Aarth & Co LLP

Chartered Accountants

Firm Registration No – 132748W / W-100823

CA Praveen Purohit

Partner

Membership No.429231

UDIN: 24429231BKDZMC4268

Place: Nashik Date: 15 July, 2024