Wonderla Holidays Ltd Directors Report.

To the Members of Wonderla Holidays Limited

Report on the Audit of the Financial Statements Opinion

We have audited the financial statements of Wonderla Holidays Limited ("the Company"), which comprise the balance sheet as at 31 March 2020, and the statement of profit and loss (including other comprehensive income), statement of changes in equity and statement of cash flows for the year then ended, and notes to the 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 financial statements give the information required by the Companies Act, 2013 ("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 2020, and profit and 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 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 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 we have obtained is sufficient and appropriate to provide a basis for our opinion on the financial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the 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
Audit of revenue recognition Our audit procedures included the following:
See note 2.5 of accounting policies to the financial statements • Assessed the revenue recognition accounting policies are in compliance with the accounting standards.
• The industry in which the Company operates involves
significant amount of cash collection for revenue generation, which carries a risk of misappropriation due to fraud or error. • Tested the design and operating effectiveness of relevant key controls with respect to revenue recognition on a sample basis.
• Tested the design, implementation and operating effectiveness of the Companys general IT controls and key application controls over the Companys IT systems which govern revenue recognition in the accounting system.
• Performed substantive tests by selecting samples of revenue transactions recorded during the year. As part of the substantive tests, we inspected the underlying documents.
• Performed reconciliations of total cash received to revenue recorded.
Provision for tax exposures Our audit procedures included the following:
See note 2.20, note 23 and note 40 of the financial statements • Read and analyzed select key correspondences, external legal opinions / consultations by the management.
• The Company operates under several tax laws and regulations and is subject to periodic challenges by tax authorities on a range of tax matters during the normal course of business including, specifically, indirect tax matters.
• Examined and analyzed provisions of the dispute resolution schemes, relevant legal precedence and other rulings.
• Examined and challenged managements key underlying
• Furthermore, the Company is eligible to opt for certain legacy dispute resolution schemes initiated by the Government which impacts the amount of provisions it is required to carry in the books. assumptions in estimating the tax provisions.
• Assessed managements estimate of the possible outcome of the disputed cases. Evaluated the impact of participation in the legal dispute resolution schemes; and
• These taxation matters involve significant management judgment, including consultations with specialists, to determine the possible outcome of the litigations and the dispute resolution schemes. Consequently, there is an impact on related accounting and disclosures in the financial statements. • Assessed the adequacy of Companys accruals and disclosures in relation to taxes.
Impairment of non-financial assets Our audit procedures included the following:
See note 2.10, 3A and 3B of the financial statements • Updated our understanding and evaluation of the controls around these risks.
• The carrying value of the Companys property, plant and equipment, capital work-in-progress and intangible assets as at 31 March 2020 (excluding land) amounts 27,078 Lakhs.
• Evaluated the possibility and plan for resumption of operations by the management.
• The Company has identified each of its Amusement Parks ("the Parks") as a separate Cash Generating Unit ("CGU"). Due to the impact of Covid 19 Pandemic, an impairment assessment of the Companys Parks is to be performed. • Assessed the assumptions used in the cash flow projections including taking into account the adverse effects that could arise from the outbreak of Covid 19 pandemic.
• Assessed the historical accuracy of the Companys forecasts by comparing with the actual results.
• The impairment testing of the Parks CGU requires significant judgements and estimates in assessing the recoverable value. The recoverable value is considered to be the higher of the Companys assessment of the Value in Use ("VIU") and the Fair Value less costs to sell ("FVLCD").
• Performed sensitivity analysis to evaluate whether any foreseeable change in assumptions could lead to change in the VIU.
• There is a risk over the Companys assessment and measurement of impairment. The risk relates to uncertainties involved in forecasting of cash flows, including key assumptions such as future revenue, margins, overheads, growth rates and weighted average cost of capital for the purpose of determining VIU. • Verified approval of the Board of Directors for the revised cost budgets of the Chennai Project.
• Tested the Project related expenditures with underlying documents to verify the existence and appropriateness of classification of such costs.
• In addition, the carrying value of capital work-in-progress towards proposed Chennai Project ("the Project") as at 31 March 2020 amounts 10,919 lakhs (including land 7,411 lakhs). • Analyzed managements assessment of the continued feasibility of the Project. Inquired with the management on the stage of development of the Project and challenged the judgments used by them for expected probable economic benefits and associated expenditures.
• The Companys initial plans to commence the Project construction by FY 2018 got delayed as tax exemptions from the Government of Tamil Nadu were awaited and recently again due to outbreak of Covid 19.
• The Companys management has obtained necessary approvals for construction. The management expect construction to restart in the last quarter of 2020 with a targeted completion by April 2022.
• Owing to the delay in the Project and uncertainty involved with respect to the timing of its restart, the carrying value of the Project requires to be assessed for recoverability.
Going concern assumption Our audit procedures included the following:
See note 2.2 and note 43 of the financial statements • Discussed with the management and Those charged with Governance regarding the possibility and plan for resumption of operations and the Companys ability to meet its obligations in the interim period.
• Due to the outbreak of Covid 19 pandemic, the Companys Amusement Parks ("the Parks") have been shut since second week of March 2020 and post balance sheet, till date.
• As a result, the evaluation of the Companys ability to continue as a Going concern and meeting its obligations to the stakeholders, creditors, employees and lenders needs to be assessed. • Assessed sufficiency of the Companys resources/funds to meet its costs in the foreseeable future.
• We assessed the appropriateness and reasonableness of the cash flow forecasts for the foreseeable future taking into account the adverse effects that could arise from the outbreak of Covid 19 pandemic.
• Evaluated the mitigation measures taken by the Companys management and Those Charged with Governance. In particular, we evaluated measures of cost rationalization, managing the Companys liquidity position and maintaining the facilities for resumption after the lockdown is lifted.

Information Other than the Financial Statements and Auditors Report Thereon

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 financial statements and our auditors report thereon.

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

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained 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 and Board of Directors Responsibility for the 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 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 accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the 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 the Board of Directors 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 Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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

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

• Obtain an understanding of internal 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 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 in the financial statements made by the Management and Board of Directors.

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

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

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the 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 Companies (Auditors Report) Order, 2016 ("the Order") issued by the Central Government in terms of section 143 (11) of the Act, we give in the "Annexure A" a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

(A) 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 purposes of our audit;

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

c) The balance sheet, the statement of profit and loss (including other comprehensive income), the statement of changes in equity and the statement of cash flows dealt with by this Report are in agreement with the books of account;

d) In our opinion, the aforesaid financial statements comply with the Ind AS specified under section 133 of the Act.

e) On the basis of the written representations received from the directors as on 31 March 2020 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2020 from being appointed as a director in terms of Section 164(2) of the Act; and

f) 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".

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

i. The Company has disclosed the impact of pending litigations as at 31 March 2020 on its financial position in its financial statements - Refer Note 40 to the financial statements;

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

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

iv. The disclosures in the financial statements regarding holdings as well as dealings in specified bank notes during the period from 8 November 2016 to 30 December 2016 have not been made in these financial statements since they do not pertain to the financial year ended 31 March 2020.

(C) With respect to the matter to be included in the Auditors Report under section 197(16):

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) which are required to be commented upon by us.

for B S R & Associates LLP

Chartered Accountants
(Firms Registration No. 116231W/W-100024)
Vipin Lodha
Partner
Place: Bengaluru (Membership No. 076806)
Date: 26 May, 2020 UDIN: 20076806AAAAAN9923

Annexure A to the Independent Auditors Report on the financial statements of Wonderla Holidays Limited for the year ended 31 March 2020

The Annexure referred to in paragraph 1 in "Report on Other Legal and Regulatory Requirements" in the Independent Auditors Report to the members of the Company on the financial statements for the year ended 31 March 2020, we report that:

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

(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In accordance with this program, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

ii. The inventory has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable. The discrepancies noticed on verification between the physical stocks and the book records were not material.

iii. According to the information and explanations given to us, we are of the opinion that there are no loans, secured or unsecured granted to companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013 ("the Act"). Accordingly paragraph 3 (iii) of the Order is not applicable.

iv. According to the information and explanations given to us, we are of the opinion that there are no loans, investments, guarantees, and securities that have been granted by the Company and hence provisions of the section 185 and 186 of the Act are not applicable to the Company. Thus, paragraph 3(iv) of the order is not applicable.

v. According to the information and explanations given to us, the Company has not accepted any deposits from the public in accordance with the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under.

vi. According to the information and explanations given to us, the Central Government of India has not prescribed the maintenance of cost records under section 148(1) of the Act, for any of the services rendered/products sold by the Company.

vii. (a) According to the information and explanations given to

us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including provident fund, employees state insurance, income-tax, goods and services tax, duty of customs, cess and other material statutory dues have been generally regularly deposited during the year by the Company with the appropriate authorities. As explained to us, the Company did not have any dues on account of sales tax, value added tax, service tax and duty of excise.

According to the information and explanations given to us, there are no undisputed amounts payable in respect of provident fund, employees state insurance, income-tax, goods and services tax, duty of customs, cess and other material statutory dues which were in arrears as at 31 March 2020 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no material dues of goods and services tax, duty of customs, value added tax, and sales tax which have not been deposited with the appropriate authorities on account of any dispute. The following dues of income tax and value added tax have not been deposited by the Company on account of disputes:

Name of the Statute Nature of dues demanded Amount ( in Lakhs) Period to which the amount relates Forum where dispute is pending
Income Tax Act, 1961 Income tax 4.45

(4.45)*

AY 2005-06 Commissioner of Income Tax
Income Tax Act, 1961 Income tax 14.69

(14.69)*

AY 2006-07 Income Tax appellate Tribunal (ITAT)
Income Tax Act, 1961 Income tax 5.92

(5.92)*

AY 2007-08 Commissioner of Income Tax
Income Tax Act, 1961 Income tax 58.28 AY 2016-17 Commissioner of Income Tax (CIT) (Appeals)
(9.59)*
Income Tax Act, 1961 Income tax 19.08 AY 2017-18 Commissioner of Income Tax (CIT) (Appeals)
Income Tax Act, 1961 Income tax 64.79 AY 2018-19 Commissioner of Income Tax (CIT) (Appeals)
Telangana VAT Act, 2005 Value added tax 57.08

(5.77)*

1 April 2014 to 30 June 2017 Additional Commissioner of Commercial Taxes, Hyderabad

*The amount in bracket represents the amount paid under protest.

viii. In our opinion and according to the explanations given to us, the Company has not defaulted in repayment of loans and borrowings to banks. The Company did not have any loans or borrowings from any financial institution, government or any dues to debenture holders during the year.

ix. In our opinion and according to the explanations given to us, the Company has applied the term loans for the purpose for which the loans were obtained. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) during the year.

x. According to the information and explanations given to us, no fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.

xi. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V of the Act.

xii. In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the Order is not applicable.

xiii. According to the information and explanations given to us and based on the our examination of the records of the Company, transactions with the related parties are in

compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

xiv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, the provisions of paragraph 3(xiv) of the Order is not applicable.

xv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

xvi. According to the information and explanations given to us, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.

for B S R & Associates LLP

Chartered Accountants
(Firms Registration No. 116231W/W-100024)
Vipin Lodha
Partner
Place: Bengaluru (Membership No. 076806)
Date: 26 May, 2020 UDIN: 20076806AAAAAN9923

Annexure B to the Independent Auditors report on the financial statements of Wonderla Holidays Limited for the year ended 31 March 2020

Report on the internal financial controls with reference to the aforesaid financial statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (Referred to in paragraph 1 (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 financial statements of Wonderla Holidays Limited ("the Company") as of 31 March 2020 in conjunction with our audit of the 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 financial statements and such internal financial controls were operating effectively as at 31 March 2020, based on the internal financial controls with reference to 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 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 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 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 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 financial statements and their operating effectiveness. Our audit of internal financial controls with reference to 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 judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

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

Meaning of Internal Financial controls with Reference to Financial Statements

A companys internal financial controls with reference to 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 controls with reference to 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 financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial controls with Reference to Financial Statements

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

for B S R & Associates LLP

Chartered Accountants
(Firms Registration No. 116231W/W-100024)
Vipin Lodha
Partner
Place: Bengaluru (Membership No. 076806)
Date: 26 May, 2020 UDIN: 20076806AAAAAN9923