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Auditor Report of NIIT Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of NIIT Limited ("the Company"), which comprise the Balance Sheet as at March 31,2015, 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.

Management's Responsibility for the Standalone Financial Statements

3. The Company's 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 standalone financial statements to 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 Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. 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 financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

4. Our responsibility is to express an opinion on these standalone financial statements based on our audit.

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

6. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

7. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

9. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the 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 March 31,2015, and its loss and its cash flows for the year ended on that date.

Emphasis of Matter

10. We draw attention to Notes 2.2 and 31 of these updated financial statements relating to the receipt of the opinion from the Expert Advisory Committee of Institute of Chartered Accountants of India ('EAC Opinion'), subsequent to the date of approval of the financial statements by the Board of Directors on May 27, 2015, but prior to placing of these in the Annual General Meeting for consideration by the shareholders, regarding accounting for the Scheme of Arrangement ('the Scheme') for amalgamation of wholly owned subsidiaries by applying purchase method of accounting in compliance with Accounting Standard 14: Accounting for Amalgamation (AS 14) and generally accepted accounting principles in India and the financial impact thereof. Pending receipt of the said opinion, the assets and liabilities of the amalgamating companies under the Scheme of Arrangement were recognized at their book values in accordance with the pooling of interest method of accounting specified in AS 14 in the financial statements referred above. Subsequent to the receipt of the EAC Opinion which requires the accounting of the Scheme by applying the purchase method, the Board of Directors has decided to give effect of the same and therefore, the financial statements as approved on May 27, 2015 and our audit report of even date, stand updated only to the extent of this revision. Our procedures on subsequent events are restricted solely to this amendment in the financial statements. Our report is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

11. As required by 'the Companies (Auditor's Report) Order, 2015', issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (hereinafter referred to as the "Order"), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

12. 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 and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone 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 31,2015 taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2015 from being appointed as a director in terms of Section 164 (2) of the Act.

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

i) The Company has disclosed the impact, if any, of pending litigations as at March 31,2015 on its financial position in its standalone financial statements - Refer Note 19;

ii) The Company has long-term contracts including derivative contracts as at March 31,2015 for which there were no material foreseeable losses.

iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31,2015.

ANNEXURE TO INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 11 of the Independent Auditors' Report of even date to the Members of NIIT Limited on the Standalone Financial Statements as of and for the year ended March 31, 2015

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

(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of two years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.

ii. (a) The inventory has been physically verified by the Management during the year. In our opinion, the frequency of verification is reasonable.

(b) In our opinion, the procedures of physical verification of inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

iii. The Company has granted unsecured loans, to two of its wholly owned subsidiary covered in the register maintained under Section 189 of the Act.

(a) The repayment terms of unsecured loan granted in the previous years to one of its wholly owned subsidiary as referred to in clause (iii) above has been extended. The outstanding loan aggregating Rs. 29.70 million which is considered doubtful of recovery has been provided for in the books of account.

(b) In respect of the aforesaid loans, in the cases where the overdue amount is more than Rupees One Lakh, other than the loan of Rs. 29.70 million, considered doubtful of recovery and provided for as referred to in para (iii) (a) above, in our opinion, reasonable steps have been taken by the Company for the recovery of the principal amounts and interest.

iv. In our opinion, and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across, nor have been informed of, any continuing failure to correct major weaknesses in the aforesaid internal control system.

v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the rules framed there under to the extent notified.

vi. We have broadly reviewed the books of account maintained by the Company in respect of products where, pursuant to the rules made by the Central Government of India, the maintenance of cost records has been specified under sub-section (1) of Section 148 of the Act, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues in respect of income tax (tax deducted at source), service tax, works contract tax and professional tax, though there has been a slight delay in a few cases, and is regular in depositing undisputed statutory dues,including provident fund, employees' state insurance, sales tax, wealth tax, duty of customs, value added tax, and other material statutory dues, as applicable, with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of income tax, sales tax, works contract tax and service tax, as at March 31, 2015 which have not been deposited on account of a dispute, are as follows:

Name of the Nature of Amount Period to which Statute Dues (Rs. In the amount millions) relates

Andhra Pradesh Works contract 31.32 2001-2004 General Sales Tax tax Act, 1957

Central Sales Tax Sales Tax 22.35 June 2005 to Act, 1956 November 2011 Sales Tax 2.50 2011-12

Customs Act 1962 Custom Duty 4.70 2012-13 and 2013-14

Finance Act, 1994 Service Tax 20.98 2004-05

Income Tax Act, Income Tax 0.41 2004-05 1961 Income Tax 30.87 2009-10

Income Tax 20.39 2010-11

Income Tax 53.46 2011-12



Name of the Forum where the dispute is Statute pending

Andhra Pradesh Supreme Court of India General Sales Tax Act, 1957

Central Sales Tax Appellate Deputy Act, 1956 Commissioner (A), Hyderabad Joint Commissioner, Kolkata

Customs Act 1962 Directorate of Revenue Intelligence, Jaipur

Finance Act, 1994 Customs, Excise and Service Tax Appellate Tribunal

Income Tax Act, Income Tax Appellate Tribunal 1961 Income Tax Appellate Tribunal

Commissioner of Income Tax (Appeals)

Commissioner of Income Tax (Appeals)

(c) The amount required to be transferred to Investor Education and Protection Fund has been transferred with in the stipulated time in accordance with the provisions of the Companies Act, 1956 and the rules made thereunder.

viii. The Company has no accumulated losses as at the end of the financial year and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.

ix. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution or bank or debenture holders as at the balance sheet date.

x. In our opinion, and according to the information and explanations given to us, the terms and conditions of charge on the assets of the company for loans taken by its subsidianes from banks and the undertaking to support NIIT Institute of Information Technology to meet short fall, if any, in repayment of loans taken by it from a bank are not considered prejudicial to the interest of the Company.

xi. In our opinion, and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.

xii. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud on or by the Company, noticed or reported during the year, nor have we been informed of any such case by the Management.

For Price Waterhouse Firm Registration Number. : 301112E Chartered Accountants

Usha Rajeev Place : New Delhi Partner Date : July 17, 2015 Membership No. 087191


Mar 31, 2014

1. We have audited the accompanying financial statements of NIIT Limited (the "Company")'' which comprise the Balance Sheet as at March 31'' 2014 and the Statement of Profit and Loss and Cash Flow Statement for the year then ended'' and a summary of significant accounting policies and other explanatory information'' which we have signed under reference to this report.

Management''s Responsibility for the Financial Statements

2. The Company''s Management is responsible for the preparation of these 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 Standards notified under the Companies Act'' 1956 (the "Act") read with the General Circular 15/2013 dated September 13'' 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act'' 2013. This responsibility includes the design'' implementation and maintenance of internal control 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.

Auditors'' Responsibility

3. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

4. An audit involves performing procedures to obtain audit evidence'' about the amounts and disclosures in the financial statements. 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. In making those risk assessments'' the auditors consider internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances'' but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Management'' as well as evaluating the overall presentation of the financial statements.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

6. In our opinion'' and to the best of our information and according to the explanations given to us'' the accompanying 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) in the case of the Balance Sheet'' of the state of affairs of the Company as at March 31'' 2014;

(b) in the case of the Statement of Profit and Loss'' of the loss for the year ended on that date; and

(c) in the case of the Cash Flow Statement'' of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

7. As required by ''the Companies (Auditor''s Report) Order'' 2003'''' as amended by ''the Companies (Auditor''s Report) (Amendment) Order'' 2004'''' issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act (hereinafter referred to as the "Order")'' and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us'' we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

8. As required by section 227(3) of the Act'' we report that:

(a) We have 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 appears from our examination of those books;

(c) The Balance Sheet'' Statement of Profit and Loss and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

(d) In our opinion'' the Balance Sheet'' Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply with the Accounting Standards notified under the Companies Act'' 1956 read with the General Circular 15/2013 dated September 13'' 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act'' 2013;

(e) On the basis of written representations received from the directors as on March 31'' 2014'' and taken on record by the Board of Directors'' none of the directors is disqualified as on March 31'' 2014'' from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Act.

Referred to in paragraph 7 of the Independent Auditors'' Report of even date to the members of NIIT Limited on the financial statements as of and for the year ended March 31'' 2014

i. (a) The Company is maintaining proper records showing full particulars'' including quantitative details and situation'' of fixed assets.

(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of two years which'' in our opinion'' is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme'' a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.

(c) In our opinion'' and according to the information and explanations given to us'' a substantial part of fixed assets has not been disposed off by the Company during the year.

ii. (a) The inventory has been physically verified by the Management during the year. In our opinion'' the frequency of verification is reasonable.

(b) In our opinion'' the procedures of physical verification of inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of our examination of the inventory records'' in our opinion'' the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

iii. (a) The Company has granted unsecured loans'' to one wholly owned subsidiary company covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year and the year-end balance of such loans aggregated to Rs. 29''700''000. The Company has not granted any other secured/ unsecured loans to companies'' firms or other parties covered in the register maintained under Section 301 of the Act. The Company had also granted a loan of Rs. 1''000''000 to NIIT Foundation (a Society) which was received back during the year. The provisions of Sec 297'' 299 and 301 of the Act are not considered to be applicable to a Society.

(b) In our opinion'' the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.

(c) The repayment terms for the unsecured loan to the wholly owned subsidiary as referred to in clause (iii)(a) above have been extended. The outstanding loan and interest'' which is considered doubtful of recovery'' has been provided for in the books of account.

(d) In respect of the aforesaid loans'' the overdue amount interest in respect of the above loan to the subsidiary'' which is fully provided for as referred to in clause (iii)(c) above'' is Rs. 6''275''706.

(e) The Company has taken unsecured loans'' from one wholly owned subsidiary covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year and the year-end balance of such loans aggregated to Rs.199''000''000.

(f) In our opinion'' the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.

(g) In respect of the aforesaid loans'' the Company is regular in repaying the principal amounts'' as stipulated'' and is also regular in payment of interest'' as applicable.

iv. In our opinion'' and according to the information and explanations given to us'' there is an adequate

internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services. Further'' on the basis of our examination of the books and records of the Company'' and according to the information and explanations given to us'' we have neither come across'' nor have been informed of'' any continuing failure to correct major weaknesses in the aforesaid internal control system.

v. (a) According to the information and explanations given to us'' we are of the opinion that the particulars of all contracts or arrangements that need to be entered into the register maintained under section 301 of the Companies Act'' 1956 have been so entered. (b) In our opinion'' and according to the information and explanations given to us'' the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees Five Lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. The Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules framed there under.

vii. In our opinion'' the Company has an internal audit system commensurate with its size and the nature of its business.

viii. The Central Government of India has not prescribed the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Act for any of the products of the Company.

ix. (a) According to the information and explanations given to us and the records of the Company examined by us'' in our opinion'' the Company is generally regular in depositing undisputed statutory dues in respect of tax deducted at source'' corporate dividend tax and service tax'' though there has been a some delay in a few cases'' and is regular in depositing undisputed statutory dues'' including investor education and protection fund'' provident fund'' employees'' state insurance'' '' wealth tax'' customs duty'' and other material statutory dues'' as applicable'' with the appropriate authorities. (b) According to the information and explanations given to us and the records of the Company examined by us'' the particulars of dues of income tax'' sales tax'' works contract tax'' service tax'' as at March 31'' 2014 which have not been deposited on account of a dispute'' are as follows:

Name of the Statute Nature of Dues Unpaid Period to which the Forum where the dispute Amount amount relates is pending (Rs million)

Andhra Pradesh Works contract 31.32 2001- 2004 Supreme Court of India General Sales tax Act'' tax 1957

Central Sales Tax Act'' Sales Tax 10.50 2010-11 Joint Commissioner'' 1956 Central audit unit(CT)'' Kolkata

Sales tax 22.35 June 2005 to Appellate Deputy November 2011 commissioner (A)'' Hyderabad

Finance Act '' 1994 Service tax 20.98 2004-05 Customs'' Excise and Service Tax Appellate Tribunal Income Tax Act'' 1961 Income tax 0.41 2004-05 Income Tax Appellate Tribunal

x. The Company has no accumulated losses as at the end of the financial year and it has not incurred any cash losses in the financial year ended on that date and in the immediately preceding financial year.

xi. According to the records of the Company examined by us and the information and explanation given to us'' the Company has not defaulted in repayment of dues to any financial institution or bank or debenture holders as at the balance sheet date.

xii. The Company has not granted any loans and advances on the basis of security by way of pledge of shares'' debentures and other securities. Therefore'' the provisions of Clause 4(xii) of the Order are not applicable to the Company

xiii. As the provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund/ societies are not applicable to the Company'' the provisions of Clause 4(xiii) of the Order are not applicable to the Company.

xiv. In our opinion'' the Company is not dealing in or trading in shares'' securities'' debentures and other investments. Accordingly'' the provisions of Clause 4(xiv) of the Order are not applicable to the Company.

xv. In our opinion'' and according to the information and explanations given to us'' the terms and conditions of the guarantees given by the Company for loans taken by others from banks or financial institutions during the year'' are not prejudicial to the interest of the Company. In our opinion and according to the information and explanations given to us'' the terms and conditions of charge on the assets of the Company given by the Company for loans taken by its subsidiaries from banks during the year and the undertaking to support NIIT Institute of Information Technology to meet shortfall'' if any'' in repayment of loans taken by it from a bank are not considered prejudicial to the interests of the Company.

xvi. The Company has not raised any term loans. Accordingly'' the provisions of Clause 4(xvi) of the Order are not applicable to the Company.

xvii. According to the information and explanations given to us and on an overall examination of the balance sheet of the company'' we report that the no funds raised on short-term basis have been used for long-term investment.

xviii. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act during the year. Accordingly'' the provisions of Clause 4(xviii) of the Order are not applicable to the Company.

xix. The Company has created charge in respect of debentures issued and outstanding at the year-end.

xx. The Company has not raised any money by public issues during the year. Accordingly'' the provisions of Clause 4(xx) of the Order are not applicable to the Company.

xxi. During the course of our examination of the books and records of the Company'' carried out in accordance with the generally accepted auditing practices in India'' and according to the information and explanations given to us'' we have neither come across any instance of material fraud on or by the Company'' noticed or reported during the year'' nor have we been informed of any such case by the Management.



For Price Waterhouse

Firm Registration Number. : 301112E

Chartered Accountants



Usha Rajeev

Place : New Delhi Partner

Date : May 21'' 2014 Membership No. 087191


Mar 31, 2012

1. We have audited the attached Balance Sheet of NIIT Limited (the "Company") as at March 31, 2012, and the related Statement of Profit and Loss and Cash Flow Statement for the year ended on that date annexed thereto, which we have signed under reference to this report. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003, as amended by the Companies (Auditor's Report) (Amendment) Order, 2004 (together the "Order") issued by the Central Government of India in terms of sub- section (4A) of Section 227 of 'The Companies Act, 1956' of India (the 'Act') and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we further report that:

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

(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of two years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies between the book records and the physical inventory have been noticed.

(c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets has not been disposed of by the Company during the year.

ii). (a) The inventory has been physically verified by the Management during the year. In our opinion, the frequency of verification is reasonable.

(b) In our opinion, the procedures of physical verification of inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material.

iii). (a) The Company has granted unsecured loans to five subsidiaries covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year and the year-end balance of such loans aggregated to Rs. 263.19 million and Rs. 36.45 million respectively. The Company had also granted a loan to NIIT Institute of Information Technology (a Society) aggregating to Rs. 15 million which was received back during the year. Provisions of Section 297, 299 and 301 of the Act are not considered to be applicable to a Society.

(b) In our opinion, the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.

(c) In respect of the aforesaid loans, the parties are repaying the principal amounts, as stipulated, and are also regular in payment of interest, as applicable. An amount of Rs. 29.7 million due from a wholly owned subsidiary is considered doubtful of recovery and has been provided for as at the year end.

(d) In respect of the aforesaid loans, there is no overdue amount more than Rupees One Lakh.

(e) The Company has taken unsecured loans, from one wholly owned subsidiary covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year and the year-end balance of such loans aggregated to Rs. 160.1 million and Rs. 158.1 million respectively.

(f) In our opinion, the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.

(g) In respect of the aforesaid loans, the Company is regular in repaying the principal amounts, as stipulated, and is also regular in payment of interest, as applicable.

iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, no major weakness have been noticed or reported.

v). (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the register required to be maintained under that section.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees Five Lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi). The Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules framed there under.

vii). In our opinion, the Company has an internal audit system commensurate with its size and the nature of its business.

viii). The Central Government of India has not prescribed the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Act for any of the products of the Company.

ix). (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues in respect of service tax , though there has been a slight delay in a few cases, and is regular in depositing undisputed statutory dues, including provident fund, investor education and protection fund, employees' state insurance, income tax, wealth tax , customs duty and other material statutory dues, as applicable, with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of income tax, works contract tax, service tax as at March 31, 2012 which have not been deposited on account of a dispute, are as follows:

Name of the Nature of dues Amount Amount Period to which Forum where the dispute is statute (Rs. Depos ited the amount pending Million) under Protest relates (Rs. Million)

Andhra Pradesh Works Contract 101.96 - 2001-March High Court of Andhra General Sales Tax Tax 2012 Pradesh Act, 1957

Finance Act, Service Tax 20.98 - 2004-05 Customs, Excise and Service 1994 Tax Appellate Tribunal

Income Tax Act, Income Tax 0.41 - 2004-05 Income Tax Appellate 1961 Tribunal

72.10 72.10 2005-06 Income Tax Appellate Tribunal

86.50 85.82 2006-07 Commissioner of Income Tax (Appeals)

71.76 58.16 2007-08 Commissioner of Income Tax (Appeals)

x). The Company has no accumulated losses as at March 31, 2012 and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.

xi). According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution or bank or debenture holders as at the balance sheet date.

xii). The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

xiii). The provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund/ societies are not applicable to the Company.

xiv). In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments.

xv). In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institution during the year. In our opinion, and according to the information and explanations given to us, the terms and conditions of charge on the assets of the Company given by the Company for loans taken by its subsidiaries from banks during the year and the undertaking to support NIIT Institute of Information Technology to meet shortfall, if any, in repayment of loans taken by it from a bank during the year, are not considered prejudicial to the interests of the Company.

xvi). The Company has not obtained any term loans.

xvii). On the basis of an overall examination of the balance sheet of the Company, in our opinion, and according to the information and explanations given to us, there are no funds raised on a short-term basis which have been used for long-term investment.

xviii). The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act during the year.

xix). The Company has created charge in respect of debentures issued and outstanding at the year-end.

xx). The Company has not raised any money by public issues during the year.

xxi). During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of any such case by the Management.

4. Further to our comments in paragraph 3 above, we report that:

(a) We have 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 appears from our examination of those books;

(c) The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act;

(e) On the basis of written representations received from the directors, as on March 31, 2012 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act;

(f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements together with the notes thereon and attached thereto give, in the prescribed manner, the information required by the Act, and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of affairs of the company as at March 31, 2012;

(ii) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

For Price Waterhouse

Firm Registration No. : 301112E

Chartered Accountants

Usha Rajeev

Place : New Delhi Partner

Date : May 9, 2012 Membership No. F-087191

 
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