New India Assurance Company Ltd Auditor Reports

To

The Members of

The New India Assurance Company Limited

Report on the audit of the Standalone Financial Statements

Qualified Opinion

We have audited the accompanying Standalone Financial statements of The New India Assurance Company Limited

(“the Company”), which comprise the Balance Sheet as at March 31, 2025, the Revenue Accounts of Fire, Marine and Miscellaneous Insurance Business (collectively known as Revenue Accounts), Profit and Loss Account and the Receipts and Payments Account 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 standalone financial statements”), in which are incorporated the returns for the year ended on that date:

a) From 51 Regional offices (including 16 LCBOs, 2 Legal Hubs, 3 Auto Hubs & Gift City office), audited by the other firms of Auditors appointed by the Comptroller and Auditor General of India under section 139 of the Companies Act, 2013;

b) From 9 Foreign Branches (including 2 Foreign Run-off offices) and 6 Foreign Agency offices audited by local Auditors appointed by the Company; and

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion section of our report, the aforesaid Standalone financial statements give the information required, in accordance with the Insurance Act, 1938, as amended (the “Insurance act”), the Insurance Regulatory and Development Authority Act, 1999 (the “IRDAI act”), IRDAI (Actuarial, Finance and Investment Functions of Insurers) Regulations 2024 (the “IRDAI Financial Statements Regulations”), orders / directions / circulars issued by the Insurance Regulatory and Development Authority of India (the “IRDAI”) and the Companies Act, 2013 (“the act”), to the extent applicable, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, as applicable to Insurance companies:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2025;

b) in the case of Revenue Accounts, of the operating Profit in so far as it relates to the Fire, Marine Insurance business and of the operating Loss so far as it relates to Miscellaneous business for year ended on that date;

c) in the case of the Profit and Loss Account, of the Profit for the year ended on that date; and

d) in the case of the Receipts and Payments Account, of the Receipts and Payments for the year ended on that date.

Basis for Qualified Opinion

Balances relating to various accounts that inter-alia includes, inter office accounts, unadjusted banking transactions, dues from / to Reinsurers, certain indirect tax related accounts and certain other accounts are subject to confirmation and reconciliation. Consequential adjustments and effect thereof in this regard, if any, is yet to be dealt with. The process of compilation of old balances is also at different stages in the company. [Refer Note No.9, Schedule 16B]

The Overall impact of the above on the state of affairs of the Company as at March 31, 2025, the Revenue Accounts, Profit and Loss Account and the Receipts and Payments Account for the year ended on that date, is presently not ascertainable and cannot be commented upon.

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) ofthe Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditors Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made there under, 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 qualified opinion.

emphasis of Matter

We invite attention to the following:

a) Note no. 5 (c) of Schedule 16B regarding non provisioning for Tax Demands on account of favourable judgements received by the Company that includes matters under appeal at the ITAT Mumbai / Honble Bombay High Court. Same is disclosed as Contingent Liabilities amounting to ? 5,79,811 Lacs.

b) Note No. 9 (b) of Schedule 16B regarding provision of ? 22,395 lakhs maintained and write off amounting to ? 2,520 lakhs made in respect of co-insurance balances as per Board approved policy and pending confirmation and reconciliation of certain such balances.

c) Note No. 22 of Schedule 16B regarding strengthening of Internal controls and Internal audit especially in the area of data input and validation in software and unreconciled/ uncompiled Reinsurance / Coinsurance / other accounts/ balances and internal audit system of the Company.

d) Note No. 26 of Schedule 16B regarding provision towards wage revision for ? 45,095 lakhs based on management assessment pending finalisation of wage negotiations.

e) Note No. 28 of Schedule 16B regarding the compliance of Rule 3(1) of The Companies (Accounts) Rules, 2014 towards audit trail and edit log and pending compliance of Section 128 of the Companies Act, 2013 and rules thereunder, as amended, regarding maintenance of the books of account and other books and papers in an electronic mode and backup thereof in respect of foreign branches of Company which is not accessible in India at all times and backup thereof is not maintained at servers physically located in India.

Our opinion is not modified in respect of the above matters.

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. We have determined the matters described below to be the key audit matters to be communicated in our report.

Sr. Key Audit Matters No.	auditors Response
1. Claim Provisioning	Principal audit Procedures Performed
Insurance Claim is the major area of expense for the insurance company. The estimation of insurance contract liabilities involves a significant degree of judgement, where management estimate is involved based on the surveyors report / feedback. The estimate of the claim is complex as it involves high degree of judgement. With regards to the claims provision, the claim department will make provision for claims upon claim intimation and subsequently revise basis the surveyors immediate loss assessment reports, advocate advice pertaining to MACT / disputed cases, communications from co-insurer leader in cases of incoming co-insurance business etc. The estimates are revised again based on further information.	• The audit matters for verification of claims provisioning are handled at the Regional Offices of the Company. We have observed that Regional Auditors while auditing the claim provision based on the operational guidelines of the Company relating to claim processing, have performed test of controls, test of details and analytical review procedures on the outstanding claims. They have verified the claim provision with the surveyors claim estimate, advocate advice, coinsurer leader communication and the Companys feedback on the same. For all old outstanding large claims, fresh estimates from surveyors were called for by the Company and the claim provisions were revised accordingly.
A range of methods are used to determine these liabilities. Underlying these methods are a number of assumptions relating to expected settlement amount and settlement pattern of claims.	• For the claim cases which has been incurred but not reported and cases where claim has been reported but not enough reported, these cases have been captured by the actuary appointed by the Company. The actuarial valuation of liability in respect of Claims Incurred but Not Reported (IBNR) and those Incurred but Not Enough Reported (IBNER) as at March 31, 2025, is as certified by the Companys Appointed Actuary.
	We have relied upon the work carried out by the respective component auditors in relation to the audit of verification of claim provisions and on the work carried out by the appointed actuary with respect to provision of claims incurred but not reported and claims incurred but not enough reported.
2 Strengthening of Internal control System and Internal audit required by the Company (Refer note no. 22, Schedule 16B)	Principal audit Procedures Performed
On the basis of selective checks carried out during the course of our audit and according to the information and explanation given to us, internal control weaknesses of material nature have been identified as at March 31, 2025 with respect to:	• We have designed our audit procedures to assess the Companys control risk. We had conducted control test to test the effectiveness of a control used by the Company to prevent or detect material misstatements. Based on the control test, control weaknesses were identified in areas of reconciliation of various receivable and/or payable balances, etc.
a) Confirmation and reconciliation of various balances relating to co insurers, reinsurers, unadjusted Banking Transactions, inter office accounts and other control accounts are pending and are at various stages;	• We have considered the reports issued by the professional consultant with respect to review of operational effectiveness of internal controls for Risk Control matrix of the Company.
b) Strengthening internal controls required in other areas of its operations by bringing more controls and validation in system.	• We have reviewed the Internal Audit System including that relating to Foreign offices of the company. Same need to be reviewed and strengthened in the area of coverage, timely completion of audit etc..
c) The Internal Audit System including that relating to Foreign offices need to be strengthened.	• Audit of health-related claims processed by TPAs are required to be audited as per policy framed by the Company, however it has been unable to carry out audit of adequate number of claims as per its policy.
d) Strengthening of process required relating to audit of health claims processed by TPA which is conducted by the offices of the Company.	Hence these areas are highlighted in paragraphs of Basis for qualified opinion, Emphasis of matter and opinion on internal financial control with reference to standalone financial statements in the Independent Auditors Report.

Other Matters

a) We did not audit the financial statements and other financial information of 51 Regional offices (including 16 LCBOs, 2 Legal Hubs, 3 Auto Hub & Gift City office) and 9 Foreign Branches (including 2 Foreign Run-off offices) and 6 Foreign Agency offices, included in the Standalone financial statements of the Company whose financial statements reflect total assets of ? 35,85,179 Lakhs as at March 31, 2025 and total revenues of ? 42,28,616 Lakhs for the year ended on that date, as considered in the Standalone financial statements. The financial statements / information of these Branches/offices have been audited by the other auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of these Branches/offices, is based solely on the report of such other auditors.

b) The actuarial valuation of liabilities in respect of Claims Incurred but Not Reported (IBNR), Incurred but Not Enough Reported (IBNER) and Premium Deficiency Reserve (PDR), is the responsibility of the Companys Appointed Actuary (the “Appointed Actuary”). The actuarial valuation of these liabilities that are estimated using statistical methods as at March 31, 2025 have been certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by IRDAI and the Institute of Actuaries of India in concurrence with the Authority. We have relied upon the Appointed Actuarys certificate in this regard for forming our opinion on the valuation of liabilities for outstanding claims reserve and PDR, as contained in the standalone financial statements of the Company. [Refer Note No. 4 of Schedule 16B].

c) The standalone financial statements of the Company for the year ended March 31, 2024 were audited by the joint auditors, one of which is predecessor audit firm and have issued their modified opinion dated May 22, 2024 on such financial statements.

Our opinion is not modified in respect of these matters.

Information other than the financial statements and Auditors report thereon

The Companys Board of Directors is responsible for the other information. The other information comprises the information included in the Directors Report & Management Discussion and Analysis and Business Responsibility Report but does not include the Standalone financial statements and our auditors report thereon. The other information as above is expected to be made available to us after the date of this auditors report.

Our opinion on the Standalone financial statements does not cover the other information and we will 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 identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the Standalone financial statements, or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

When we read the other information, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.

Responsibilities of Management and Those Charged with Governance for the Standalone 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 Standalone financial statements that give a true and fair view of the financial position, financial performance and receipts and payments of the Company, in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Act read with relevant rules issued thereunder, the requirements of the Insurance Act, the IRDAI Financial Statements Regulations and the orders/directions and circulars issued by the IRDAI in this regard, to the extent applicable and in the manner so required.

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 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 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 Standard on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Standalone financial statements.

As part of an audit in accordance with Standard on Auditing, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the Standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act, 2013, 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 standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors report. However, future events or conditions may cause the Company to cease to continue as a going concern.

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

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on other Legal and Regulatory Requirements

1. As required by the IRDAI Financial Statements Regulations, we have issued a separate certificate dated May 19, 2025 certifying the matters specified in paragraphs 3 and 4 of Schedule II, Part III to the IRDAI Financial Statements Regulations.

2. As required by IRDAI Financial Statement Regulations and Section 143 (3) of the Act, we report that:

a) We have sought and except for the matters described in the Basis for Qualified Opinion paragraph, obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

b) Except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph above read with Note No. 28 regarding accessibility and back up of the books of accounts and papers at servers physically located India on a daily basis , in our opinion, proper books of account have been maintained by the Company, so far as it appears from our examination of those books and proper returns from Regional / Foreign Offices, not visited by us, have been received and these were adequate for the purpose of our audit.

c) The reports of Auditors of Regional Offices, foreign branches and foreign agency offices/ Run-off office, audited under section143(8) of the Act by the respective component auditors have been forwarded to us and have been properly dealt with by us in preparing our report in the manner considered necessary by us.

d) The Balance Sheet, the Revenue Accounts, Profit and Loss Account, and the Receipts and Payments Account dealt with by this Report are in agreement with the books of account and with the returns received from offices not visited by us.

e) Except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph above, in our opinion, the aforesaid Standalone financial statements have been prepared in accordance with the requirements of the Insurance Act, the Insurance Regulatory and Development Act, 1999 and the Companies Act, 2013 to the extent applicable and in the manner so required.

f) Except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, in our opinion, the aforesaid Standalone Financial Statements comply with the Accounting Standards specified under Section 133 of the Act read with relevant rules issued thereunder.

g) The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the Basis for Qualified Opinion paragraph above.

h) As per notification no. G.S.R 463(E) dated June 5, 2015, the Government Companies are exempted from the provisions of section 164(2) of the Act, accordingly, we are not required to report whether any of the directors of the Company is disqualified in terms of provisions contained in the said section.

i) The accounting policies selected by the company are appropriate and are in compliance with the applicable Accounting Standards specified under Section 133 of the Act read with relevant rules issued thereunder and with the Accounting Principles as prescribed in the IRDAI Financial Statements Regulations and orders or directions issued by the Insurance Regulatory and Development Authority, except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph above.

j) The actuarial valuation of liability in respect of claims Incurred but Not Reported (IBNR) and those Incurred but Not Enough Reported (IBNER) as at March 31, 2025, have been duly certified by the Companys Appointed Actuary and relied upon by us. The Appointed Actuary has also certified that the assumptions considered by him for such valuations are in accordance with guidelines and norms prescribed by the Insurance Regulatory and Development Authority of India and the Actuarial Society of India in concurrence with the IRDAI.

k) As per the information and explanations provided to us, the investments have been valued in accordance with the provisions of the Insurance Act, IRDAI Financial Statements Regulations and orders/ directions issued by IRDAI in this regard.

l) With respect to the adequacy of the internal financial controls with reference to standalone financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure I”.

3. With respect to the other matters to be included in the Auditors Report in accordance with the requirement of section 197(16) of the Companies Act 2013, as amended, we report that the provisions of section 197 of the Act are not applicable to the company vide notification No. GSR 463(E) dated 5^th June 2015. Hence reporting u/s 197(16) of the Act is not required.

4. 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, as amended, 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 standalone financial statements - Refer Note 5 (c) of Schedule 16B and Note 1 of Schedule 16C to the Standalone financial statements;

ii) The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long- term contracts including derivative contracts - The liability for Insurance Contracts, is determined by the Companys Appointed Actuary and is covered by the Appointed Actuarys certificate, referred to in Other Matter paragraph above, on which we have

placed reliance; and the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company;

iv) 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 person(s) or entity(ies), 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 (Refer Note 24 (a) of Schedule 16B)

b) Management has represented that , to the best of its knowledge and belief, 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 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 (Refer Note 24 (b) of Schedule 16B); and,

c) Based on 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 under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.

v) The final dividend paid by the Company during the year in respect of the same declared for the previous year is in accordance with section 123 of the Act to the extent it applies to payment of dividend.

As stated in Note no.30, Schedule 16B of the financial statements, the Board of Directors of the Company have proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. Except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph above, the dividend proposed is in accordance with section 123 of the Act to the extent it applies to declaration of dividend.

vi) Based on our examination which included test checks and based on the reports received from the Regional Auditors and the branch auditors of Foreign Branches/ offices, the company has used accounting softwares for maintaining its books of account which have a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further, during the course of our audit, based on test checks , we did not come across any instance of audit trail feature being tampered with and the audit trail has been preserved by the Company as per the statutory requirements for record retention except in case of Foreign branches/offices where compliance of record retention could not be verified due to lack of requisite details available in India.

5. As required under section 143(5) of the Companies Act, 2013, based on our audit as aforesaid, we give in the “Annexure II”, a report on the directions including Sub directions issued by the Comptroller and Auditor General of India (C&AG), action taken thereon and its impact on the accounts and financial statements of the Company.

ANNEXURE I TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 2 (l) under “Report on Other Legal and Regulatory Requirements” of our report of even date)

Report on the Internal Financial Controls with reference to Standalone Financial Statements under clause (i) of sub- section 3 of section 143 of the Companies Act, 2013 (“the Act”)

Qualified Opinion

We have audited the internal financial controls with reference to standalone financial statements of The New India Assurance Company Ltd. (“the Company”) as of March 31, 2025, in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

According to the information and explanations given to us and based on our audit, the following material weaknesses have been identified as at March 31, 2025:

a) Confirmation and reconciliation of various balances relating to Co-insurers, reinsurers, Reinsurance Brokers, unadjusted Banking transactions, inter office accounts, certain indirect tax related accounts and other accounts, are pending and are at various stages of reconciliation/ adjustments. Non- compliance of tax laws which may arise out of such reconciliation;

b) Adequate coverage of audit of health-related claims processed by TPAs to be conducted by the respective offices of the Company in accordance with the policy of the Company;

c) We are informed that the management has not carried out the assessment of effectiveness of the controls at foreign offices of the company. We have also not been able to carry out any procedures in these respect as the relevant information and access was not made available to us and

d) Control deficiency in the case of holding and registering of Immovable properties.

A material weakness is a deficiency, or a combination of deficiencies, in internal financial control with reference to standalone financial statements, such that there is a reasonable possibility that a material misstatement of the companys financial statements will not be prevented or detected on a timely basis.

In our opinion , to the best of our information and according to the explanations given to us and based on the consideration of the reports of the other auditors referred to in the Other Matters paragraph below, except for the possible effects of the internal control weaknesses described above on the achievements of the objectives of the control criteria, the company has maintained , in all material respects , adequate internal financial control with reference to standalone financial statements and such internal financial controls with reference to standalone financial statements were operating effectively as of March 31,2025, based on “the internal control with reference to standalone financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note issued by the Institute of Chartered Accountants of India”.

We have considered the material weaknesses identified and reported above in determining the nature, timing, and extent of audit tests applied in our audit of the March 31, 2025, Standalone financial statements of the Company, and these material weaknesses affect our opinion on the Standalone financial statements of the Company.

Managements Responsibility for Internal Financial Controls

The Companys management is responsible for establishing and maintaining internal financial controls based on “the internal control 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”). 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 Insurance Act, 1938, as amended (the “Insurance Act”), the Insurance Regulatory and Development Authority Act, 1999 (the “IRDAI Act”), IRDAI (Actuarial, Finance and Investment Functions of Insurers) Regulations 2024 (the “IRDAI Financial Statements Regulations”), orders / directions / circulars issued by the Insurance Regulatory and Development Authority of India (the “IRDAI”) and Companies Act, 2013.

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. 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 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 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 internal financial controls with reference to standalone financial statements , 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 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 qualified opinion on the Companys internal financial controls system with reference to standalone financial statements .

Meaning of Internal Financial Controls with reference to standalone financial statements

A Companys internal financial control with reference to standalone financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A Companys internal financial control with reference to standalone financial statements 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 authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the 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 control 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.

Other Matters

a) Our aforesaid report under section 143(3)(i) of the Act on the adequacy and operating effectiveness of the Internal Financial Controls with reference to Financial Statements in so far as it relates to 51 Regional offices (including 16 LCBOs, 2 Legal Hubs, 3 Auto Hub & Gift City office), audited by the other firms of Auditors appointed by the Comptroller and Auditor General of India under section 139 of the Companies Act, 2013, 9 Foreign Branches (including 2 Foreign Run-off offices) and 6 Foreign Agency offices audited by local Auditors appointed by the Company, is based on the corresponding reports of the other auditors which has been sent to us and has been properly dealt with in preparing this report in the manner considered necessary by us.

b) The actuarial valuation of liabilities in respect of Claims Incurred but Not Reported (IBNR), Incurred but Not Enough Reported (IBNER) and Premium Deficiency Reserve (PDR), is the responsibility of the Companys Appointed Actuary (the “Appointed Actuary”). The actuarial valuation of these liabilities that are estimated using statistical methods as at March 31,2025 have been certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by IRDAI and the Institute of Actuaries of India in concurrence with the Authority. We have relied upon the Appointed Actuarys certificate in this regard for forming our opinion on the valuation of liabilities for outstanding claims reserve and PDR, as contained in the standalone financial statements of the Company. Accordingly, our opinion on the internal financial controls with reference to standalone financial statements does not include reporting on the adequacy and operative effectiveness of the internal controls over the valuation and accuracy of the aforesaid actuarial liabilities.

Our opinion is not modified in respect of these matters.

ANNEXURE II TO THE INDEPENDENT AUDITORS REPORT

(Referred to in Paragraph 5 under “Report on Other Legal and Regulatory Requirements” of our report of even date)

Based on the verification of records of The New India Assurance Company Ltd. (the “Company”) and based on information and explanations given to us, we give below a report on the directions including Sub directions issued by the Comptroller and Auditor General of India in terms of the section 143(5) of the Act:

Sr No.	Directions under Section 143(5) of Companies Act, 2013	auditors Comment
1	Whether the company has system in place to process all the accounting transactions through IT system? If yes, the implications of processing of accounting transactions outside IT system on the integrity of the accounts along with the financial implications, if any, may be stated.	As per the information and explanations furnished to us, the company has an Enterprise Resource Planning (“ERP”) system in the name of “CWISS” to process the accounting transactions except for: a) Facultative Inward business where the process of system automation is being implemented. In case of Marine Hull, Marine Cargo and Aviation the same is under testing stage and as informed to us in FY 2025-26, the modules will get implemented, after which reconciliation will be done through system of the Company. Further, Non-proportional Treaty Accounting automation is also under testing stage and as informed to us, the same will also be implemented in F.Y 2025-26 b) Pradhan Mantri Fasal Bima Yojana (PMFBY) where it is understood that though the systems are in place the claims related to the PMFBY are processed manually. It is informed to us that Ministry of Agriculture and Farmers Welfare are planning for integration of National Crop Insurance Portal (NCIP) with the IT Systems of "PMFBY - Implementing Insurance Companies" for seamless flow of data and "auto calculation" of claims in NCIP. As per the requirement of the Ministry, the Company has provided them their IP address for whitelist for inflow/outflow of data to and from NCIP. Once the integration is completed, the Company will redesign the system for claim processing for PMFBY c) IFSC GIFT City office, Gandhinagar is the only office in India rendering the reinsurance service in foreign currency, having the Accounts in Tally software for a portion of the year migrated to RAMS. However, Data Migration Audit of the same is not done. The transactions are reviewed/ authorised by Region-in charge and approved as per the financial authority established in the Company. d) The Process of compilation of Financial statements of the Company involves movement of trial balances in an unconnected mode and involves manual compilation from the following softwares to HO INFACS system which is used for the purpose of consolidation of above trial balances: i) Investment: CREDENCE (Excel) ii) Reinsurance: RAMS (Excel). iii) Foreign Branches and Agency: decentralized system at each location. Consolidation is done at HO level in excel. iv) ORACLE Financials: at ROs, output file of oracle is used as input for INFACS.
		There is a need of full automation of Process of compilation of financial statements to ensure complete data integrity. In the case of UK operations, the branch auditors have reported as under: The branch has system in place to process all the accounting transactions through IT systems except as below: a) Underwriting systems & Accounting systems are not linked. The information is uploaded to the accounting system by using CSV Files. b) FX Calculations are performed separately in Excel and journal entries are posted in the accounting system. c) UPR and Deferred commission calculations are performed in Excel for reporting purposes.
2	Whether there is any restructuring of an existing loan or cases of waiver/write off of debts /loans/interest etc. made by a lender to the company due to the companys inability to repay the loan? If yes, the financial impact may be stated. Whether such cases are properly accounted for? (in case, lender is a government company, then its directions is also applicable for statutory auditor of lender company)	Not Applicable.
3	Whether funds (grants/subsidy etc.) received/receivable for specific schemes from central/ state government or its agencies were properly accounted for/ utilized as per its term and conditions? List the cases of deviation.	The Company received part of subsidy relating to Rashtriya Swasthya Bima Yojana (RSBY) and various other schemes relating to insurance from State Government/Agencies. Funds received/receivable under RSBY scheme from State Government/ Agencies were accounted for/utilised as per its terms and conditions. However funds received/receivable from Central/ various State Governments under PMFBY scheme are being reconciled with Government Portal data.

Sub directions issued by C&AG of India as applicable to the New India Assurance Company Limited for the year 2024-25

Sr No.	Sub Directions under Section 143(5) of Companies act, 2013	auditors Comment
1.	Number of titles of ownership in respect of CGS/SGS/Bonds/ Debentures etc. available in physical/demat form and out of these, number of cases which are not in agreement with the respective amounts shown in the Companys books of accounts may be verified and discrepancy found may be suitably reported.	The Central Government/ State Government securities balances are tallied as per the books of accounts of the Company with the custodian statements. In case of Bonds/ Debenture/ Equities/ Preference Shares, balances are tallied as per the books of accounts of the Company and custodian statement except for the following differences: a) Investment in 28 scrips of equity shares having book value of ?1441.77 lakhs are under shortage / objection / physical transit / dematerialization / in the process of conversion of name of Company. b) Investment in 2 scrips of equity shares have been sold by company but are in the process of removal from custodian statement. c) Investment in 16 scrips of preference shares having book value of ?11.57 are under demat / physical transit/ in the process of conversion of name of Company. d) Investment in 23 scrips of Bonds / Debentures having face value of ? 541.69 lakhs are under shortage / objection / physical transit / with official liquidator. e) Investment in 22 scrips of Bonds / Debentures having face value ? 70675.49 lakhs are settled and removed from Company books but not removed from custodian Statement. The Company is in the process of taking adequate steps for reconciliation and adjustments wherever required.
2.	Whether investment policy exists and includes mechanism to review investment portfolios and also whether stop loss limits are prescribed? If yes, whether it was adhered to? if not in existence or not adhered to, details may be given.	An investment policy is framed for each financial year and the same is approved by the Board. Further, a stop loss/exit policy has been incorporated in Investment Policy of FY 2024-25. The stop loss policy is adhered to and the shares which satisfy the criteria of stop loss/exit is placed before the in-house investment committee for suitable action.
3.	Whether Company has carried out reconciliation exercise for inter-company balances reflected in their financial statements with other PSU insurers and whether confirmation has been obtained from other PSU insurers for balances due from them?	As informed to us, reconciliation and settlement of Coinsurance balances were carried out across all offices throughout the year by the Company. In case where the Company is follower the necessary confirmations are obtained from the lead insurer on periodical basis through various modes, by letter of acceptance/mail confirmation/agreement in meetings etc. In respect of Coinsurance business, the balances with various Co-insurers represent a receivable of ? 85,335 lakhs and payable of ? 36,031 lakhs, which included balances relating to PMFBY amounting to ?1559 lakhs (Net). The process of obtaining confirmations and reconciliation of balances is at different stages and entries remaining to be reconciled based on the confirmation are also being attended to. Age-wise breakup of the outstanding entries has been compiled based on available information.
		The process of obtaining confirmations of balances relating to PMFBY and other balances is also at different stages and entries remaining to be reconciled based on the confirmation are also being attended to. The age- wise break-up of the outstanding entries including those relating to crop insurance is being compiled in-view of entry-wise break up not being precisely available. The policy-wise details of balances lying in the old accounting system are not available however these balances are netted for the purpose of reconciliation. In respect of PMFBY business, the accounting of transactions has been done to the extent of statement of accounts received with the leaders till the finalisation of Accounts. Based on the Board approved policy depending on the age of outstanding, the company has maintained provision of ? 22,395 lakhs during the year (Previous year ? 34,075 lakhs). The cumulative provision held amounts to ?22,395 lakhs as against the net coinsurance balance of ?49,304 lakhs as on March 31.2025, which is based on the available information as considered by the management The net balances due to/due from in respect of re- insurance activities of the company ?541637 lakhs comprising ?589529 Lakhs (Dr.) and ?47892 lakhs (Cr.) contain various entries outstanding for more than 10 years where process of matching open items, confirmation and reconciliation is in progress. The above include balances relating to Terrorism Pool ?345823 lakhs and Nuclear Pool of ?23308 lakhs due from General Insurance Corporation of India (GIC Re) and ?34979 Lakhs due from Agricultural Insurance Company of India Ltd. for which confirmation of balances is received but these are subject to reconciliation in respect of old entries appearing in the books. These accounts are still under the process of compilation/age-wise analysis/ reconciliation and segregating into debit and credit balances. Also, there are migration differences which need to be reconciled. Pending all such activities the impact on the financial statements is unascertainable. As against Net Reinsurance balance of ?541637 Lakhs(Net) (Dr.) as on March 31,2025, the Company has maintained a provision of ?93536 Lakhs up to March 31.2025, towards doubtful debts as a prudent measure. During the period ended March 31, 2025, the Company has written off (net debit) non-moving reinsurance balances of ?5383 Lakhs. Refer Note no. 9 (a) and (b) of Schedule 16B of the Standalone Financial Statements for reconciliation related matter with respect to Reinsurance and Coinsurance balances.
4.	Whether entire input tax credit (ITC) available on GST portal in respect of the company has been availed within prescribed time limits.	The Company avails GST input credit only on the basis of valid tax invoice at the time of making payment of invoices. It has a process of not availing the ineligible GST input credits even if the same is reflecting on the GST portal.
		The Company claims the input credit with respect to GST paid on RCM which constitutes the significant portion of the entire GST input credit of the Company, in the month of payment and the same is claimed through the system automatically. For a portion of the expenses, where input is claimed based on the valid invoices received from the suppliers, based on test checks, validation checks are verified in the system, and on compliance of the validations the system allows for claiming input. Input GST is claimed in respect of those invoices for which actual payment has been made. Input is not claimed on those invoices lying unpaid, as the same can be availed up to due date of filing October 2025 GST Returns, for those invoices raised during the F.Y 2024-25. Hence the input credit in respect of such unpaid invoices would be reflected in GSTR 2A but the same would not have been claimed in a particular month. In case of expenses, where input credit is not eligible, the same is being reflected in the GSTR 2A but credit has not been availed. Reconciliation of difference between GSTR 3B vs 2B representing excess balances of ? 347 Lakhs as on March 31, 2025. This difference is mainly due to i) RCM credit wrongly reported in all other ITC. ii) Ineligible ITC due to POS restrictions. iii)B2B amendments are reported in all other ITC. Input Tax credit ?3955 Lakhs relating to FY 2021-22, ?1960 Lakhs for FY 2022-23 and ?1307 Lakhs for FY 2023-24 which included GST not paid by vendors as well unmatched entries and had lapsed (provision made by the Company). For FY 2024-25, the ITC not availed amounts to ?4735 Lakhs which will lapse by due date of filing October 2025 GST Returns. Follow up needs to be improved with the vendors/parties for payment/ proper matching. TDS on GST account is required to be reconciled. There are unreconciled balances in ITC, TDS on GST and other GST related ledgers which need attention. Refer Note no. 9 (c) of Schedule 16B of the Standalone Financial Statements for reconciliation related matter with respect to GST balances. We have issued modified opinion in this Independent Audit Report with regard to this matter.
5.	Whether reporting as to the adequacy of accounting/MIS or other mechanism by which treaty wise or facultative arrangement-wise performance (premium ceded/accepted, claims thereon and commission-including all rewards and remuneration to intermediaries/cedants) is assessed in all different segments, geographies and departments engaged in reinsurance operations.	The accounting of premium, commission, paid claims and outstanding claims in the RAMS based on the treaties/FAC attachments and policy level data has flown from CWISS (Direct side). In RAMS, based on the aforesaid data front end reports are generated such as treaty wise statistics on the basis of which review of treaty performance and cost benefit analysis is done. However it is noticed that the respective departments have incorporated various manual journal entries to carry out rectifications/ other entries which needs to be avoided.
6.	Whether the RAMS software is in sync with the CWISS software (accounting software) of the Company and that the data is also fetched from RAMS by CWISS for the purpose of Accounting and Payouts.	RAMS software is in sync with the CWISS software(accounting software) of the Company. Though manual JEs are being passed in certain areas, it is explained that the management is in the process of complete integration and automation of both the software.

 

For R. Devendra Kumar & Associates	For Chokshi & Chokshi LLP
Chartered Accountants	Chartered Accountants
FRN: 114207W	FRN: 101872W/W100045
(Anand Golas)	(Dharmista Shah)
Partner	Partner
M. No.: 400322	M. No. 108845
UDIN: 25400322BMJUVD2288	UDIN:25108845BMFXRS8105
date: May 19, 2025
Place : Mumbai