RCL Retail Ltd Directors Report.

TO THE MEMBERS OF RCL RETAIL LIMITED, CHENNAI FOR THE YEAR ENDED 31ST MARCH 2019

TO THE MEMBERS OF RCL RETAIL LIMITED

Report on the Ind AS Financial statements

We have audited the accompanying Ind AS Ind AS Financial statements of RCL RETAIL Limited (the company), which comprise the Balance Sheet as at 31st March 2019, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Managements Responsibility for the Ind AS Financial statements

The Companys Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 (the act) with respect to the preparation of these Ind ASI nd AS Financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2015, as amended.

This responsibility also includes the 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 the frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are responsible 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 Ind AS Financial statements that give a true and view and are free from material misstatement, whether due to fraud or error.

Auditors Responsibility

Our responsibility is to express an opinion on these Ind AS Financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and the auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards of Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Ind AS Financial statements are free from material misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the Ind AS Financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of the material misstatement of the Ind AS Financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companys preparation of the Ind AS Financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances.

An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companys Directors, as well as evaluating the overall presentation of the Ind AS

Financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Ind AS Financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind AS Financial statements, give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

a) of the state of affairs of the Company as at March 31, 2019

b) of the Profit for the year ended on that date; and

c) of the cash flows for the year ended on that date.

Report on other Legal and Regulatory requirements

1. As required by the Companies (Auditors Report) order, 2016 (the Order), issued by the Central Government of India in terms of sub section (11) of section 143 of the Act, we give in the Annexure-A a statement on the matters specified in paragraphs 3 & 4 of the Order, to the extent applicable.

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

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

 b. In our opinion proper books of account as required by Law have been kept by the Company so far as it appears from our examination of those books.

c. The Balance Sheet, the Statement of Profit & Loss and Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d. In our opinion, the aforesaid Ind AS Financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules,2014.

e. On the basis of the written representations received from the directors as on March 31, 2019, taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2019 from being appointed as a director in terms of section 164 (2) of the Act.

f. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in Annexure B.

g. With respect to the other matters to be included in the Auditors Report in accordance with Rule 11of the Companies (Audit and auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its Ind AS Financial statements - Refer Note No. 29 Annexure to the Ind AS Financial statements

ii. The Company did not have any long term contracts including derivatives contracts for which there were any material foreseeable losses.

iii. During the year, there were no requirement on the part of the company to transfer any amount to the Investor Education and Protection Fund.

For M/s. Kalyanasundaram & Co
Chartered Accountants
Sd/-
B. KALYANASUNDARAM, F. C. A,
Place : Chennai Partner
Date : 03.09.2019 Membership No.:011453

ANNEXURE A TO INDEPENDENT AUDITORS REPORT TO THE MEMBERS OF RCL RETAIL LIMITED, CHENNAI FOR THE YEAR ENDED 31ST MARCH 2019

Annexure A referred to in our report under Report on Other Legal and Regulatory requirements Para 1 of even date on the accounts for the year ended 31st March 2019.

1. In respect of its fixed assets:

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

(b) The fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

2. The stock of traded goods has been physically verified by the management at the close of the year.

As per the information given to us the procedure of physical verification of traded stock followed by the management is in our opinion reasonable and adequate in relation to the size of the company and its nature of business.

On the basis of examination of stock record it is found that the same have been properly maintained and the discrepancies if any noticed on physical verification have not been material as compared to the book record.

3. During the year, the company has not granted any loan to a company, firm, Limited Liability Partnerships or other parties covered in the register maintained under the Section 189 of the Companies Act, 2013.

4. During the year, the Company has not granted any loan, furnished any guarantees or provided any security. The Company has complied with the provisions of section 185 of the Companies Act, 2013. The provisions of Section 186 are not applicable to the company.

5. The company has not accepted any deposit within the meaning of the sections 73 to 76 of the Companies Act, during the year.

6. According to the information and explanations furnished to us, the requirement for maintenance of the cost records pursuant to the Companies (Cost Records and Audit) Rules, 2014 specified by the Central Government of India under section 148 of the Companies Act, 2013 are not applicable to the Company for the year under audit.

7. (a) According to the records provided to us, the company is generally regular in depositing undisputed statutory dues including Provident Fund, Income Tax, Goods and Service Tax and Tax Deducted at Source with the appropriate authorities. However we have observed delays in remitting sums in respect of Tax deducted at source and Goods and Service Tax.

(b) According to information and explanations given to us, there are no disputed dues that were not deposited with the concerned authorities.

8. The company has not availed any term loans from Bank or financial institutions. Hence the question of reporting on default in repayment thereof does not exist.

9. The company has not raised any money by the way of initial public offer or further public offers including debt instruments or by the way of term loans during the year. Hence reporting on utilization of such money does not arise.

10. Based on the audit procedures adopted and information and explanations furnished to us by the management, no fraud on or by the company has been noticed or reported during the course of our audit.

11. No managerial remuneration has been paid or provided during the year.

12. The company is not a Nidhi Company and as such this clause of the Order is not applicable.

13. (a) In our opinion and according to the information and explanations furnished to us, all transactions with the related parties are in compliance with sections 177 and 188 of Companies Act, 2013.

(b) The details of transaction during the year have been disclosed in the Ind AS Financial statements as required by the applicable accounting standards. Refer Note No. 31 to Ind AS Financial statements. 14. During the year, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures under section 42 of the Companies Act, 2013. 15. In our opinion and according to the information and explanations furnished to us, the company has not entered into any non-cash transactions with directors or persons connected with them. 16. The company is not required to register under section 45-IA of the Reserve Bank of India Act,

1934.

For M/s. Kalyanasundaram & Co
Chartered Accountants
Sd/-
B. KALYANASUNDARAM, F. C. A,
Place : Chennai Partner
Date : 03.09.2019 Membership No.:011453

ANNEXURE B TO THE INDEPENDENT AUDITORS REPORT TO THE MEMBERS OF RCL RETAIL LIMITED, CHENNAI FOR THE YEAR ENDED 31ST MARCH 2019

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

We have audited the internal financial reporting of RCL RETAIL Limited, Chennai (the Company) as of March 31, 2019 in conjunction with our audit of the Ind AS Financial statements of the Company for the Year ended on that date.

Managements Responsibility for Internal Financial Controls

The Companys Management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. 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 company policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information as required under the Companies Act, 2013.

Auditors Responsibility

Our responsibility is to express an opinion on the Companys Internal Financial Control over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing (the Standards), issued by the ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the Ind AS Financial statements, whether due to fraud or error.

Meaning of Internal Financial Controls over Financial Reporting

A companys internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Ind AS Financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial control over financial reporting includes those policies and procedures that

1. Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company.

2. Provide reasonable assurance that transactions are recorded as necessary to permit preparation of Ind AS 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 Ind AS Financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

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

Opinion

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

i. Existing policies and procedures adopted by the Company for ensuring orderly and efficient conduct of the business.

ii. Continuous adherence to Companys policies.

iii. Existing procedure in relation to safeguarding of Companys fixed assets, Investments,

Receivables, loans and advances made and cash and bank balances.

iv. Existing system to prevent and detect fraud and errors.

v. Accuracy and completeness of Companys accounting records.

vi. Existing capacity to prepare timely and reliable financial information.

For M/s. Kalyanasundaram & Co
Chartered Accountants
Sd/-
B. KALYANASUNDARAM, F. C. A,
Place : Chennai Partner
Date : 03.09.2019 Membership No.:011453