Auditor Report of Ircon International Ltd.

Mar 31, 2025

We have audited the accompanying Standalone Ind
AS Financial Statements of Ircon International Limited

("the Company") which comprise the Balance Sheet
as at 31^st March, 2025, the Statement of Profit and Loss
(including Other Comprehensive Income), the Statement
of Changes in Equity and the Statement of Cash Flows
for the year ended on that date and notes to the
financial statements including a summary of the material
accounting policies and other explanatory information in
which are incorporated the Returns for the year ended on
that date audited by branch auditors of the Company''s
branches at Algeria, Bangladesh, Sri Lanka and Myanmar
(hereinafter referred to as the "Standalone Ind AS Financial
Statements").

We have audited the financial statements of the three (3)
foreign branches situated at South Africa, Malaysia and Sri
Lanka (Indian part) for the year ended 31^st March, 2025.
However, we have not visited any foreign branch and the
relevant information for the audit purpose was provided
to us by the management at corporate level.

In our opinion and to the best of our information and
according to the explanations given to us, the aforesaid
Standalone Ind AS Financial Statements give the
information required by the Companies Act, 2013 ("the
Act") in the manner so required and give a true and fair
view in conformity with the Indian Accounting Standards
prescribed under section 133 of the Act read with the
Companies (Indian Accounting Standards) Rules,2015
("Ind AS") and other accounting principles generally
accepted in India, of the state of affairs of the Company
as at 31^st March, 2025, the profit, total comprehensive
income, changes in equity and its cash flows for the year
ended on that date.

Basis for Opinion

We conducted our audit of the Standalone Ind AS
Financial Statements in accordance with the Standards

on Auditing ("SAs") specified under section 143(10) of
the Act. Our responsibilities under those Standards
are further described in the Auditor''s Responsibilities
for the Audit of the Standalone Ind AS 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 Ind AS
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 ICAI''s Code of Ethics.
We believe that the audit evidence obtained by us
and other auditors in terms of their reports referred
to it "Other Matter" paragraph below, is sufficient and
appropriate to provide a basis for our audit opinion on
the Standalone Ind AS Financial Statements.

Emphasis of Matters

Reference is invited to footnote no.(ii)(b) of Note no. 8.1
of the Standalone Ind AS Financial Statements wherein it
has been stated that financial statements of one of the
jointly controlled entities i.e. Indian Railway Stations
Development Corporation Ltd. (IRSDC) have been
prepared on liquidation basis and that the Company does
not foresee any impairment in the value of investments
held by it in IRSDC.

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

Key Audit Matters

Key audit matters are those matters that, in our
professional judgment, were of most significance in
our audit of the Standalone Ind AS Financial Statements
of the current period. These matters were addressed
in the context of our audit of the Standalone Ind AS
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.

Key Audit Matter	How our audit addressed the matter
Revenue Recognition in terms of Ind AS 115 “Revenue from Contracts with Customers" Accounting Standard on Revenue which prescribes five steps revenue recognition model. The Company recognizes revenue for a performance obligation satisfied over time after estimating its progress towards complete satisfaction of the performance obligation. The recognition of revenue requires assessments and judgments to be made on changes in work scope, claims (compensation, rebates etc.) and other payments to the extent performance obligation is satisfied. The company measures the performance obligation by applying input method. In the contracts where performance obligation cannot be measured by input method, the output method is applied, which faithfully depict the Company''s performance towards complete satisfaction of the performance obligation.	- Our audit procedures included considering the appropriateness of the Company''s revenue recognition accounting policies and assessing compliance with the policies in terms of the applicable accounting standards. We evaluated the effectiveness of control over the preparation of information that are design to ensure the completeness and accuracy. We selected a sample of contracts, and tested the operating effectiveness of the internal control, relating to identification of the distinct performance obligations and satisfaction of performance obligations. We also examined costs included within WIP balances on a sample basis and tested their recoverability through comparing the net realizable values as per the agreements with estimated cost to complete. - We performed following substantive procedures over revenue recognition with specific focus on whether there is single performance obligation or multiple performance obligations in the contract and whether the performance obligation is being satisfied over the period of time or at a point in time: • Read, analyzed and identified the distinct
During order fulfillment, contractual obligations may need to be reassessed. In addition, change orders or cancelations have to be considered. As a result, total estimated project costs may exceed total contract
revenues and therefore require immediate recognition of the expected loss.	performance obligations in these contracts.
Ind AS 115 requires entities to exercise judgement, taking into consideration all of the relevant facts and	• Compared these performance obligations with that identified and recorded by the Company.
circumstances when applying each step of the model to	• Considered the terms of the contracts to verify
contracts with their customers.	the transaction price used to allocate to separate
The application of the revenue accounting standard	performance obligations.
involves certain key judgements relating to -	• Checked whether the performance obligation is
	being satisfied over the period of time or at a point
i. identification of distinct performance obligations;	in time.
ii. determination of transaction price of the identified	• Performed analytical procedures for reasonableness
performance obligations;	of revenues disclosed
iii. the appropriateness of the basis used to measure
revenue recognized at a point in time or over time.
Additionally, revenue accounting standard contains disclosures which involves collation of information in respect of disaggregated revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. Revenue recognition from these judgements were identified as a Key Audit Matter and required a higher extent of audit effort.
Refer Note no. 39 to the Standalone Ind AS Financial
Statements.

Key Audit Matter	How our audit addressed the matter
Contingent Liabilities There are a number of litigations pending before various forums against the Company and the management''s judgement is required for estimating the amount to be disclosed as contingent liability. We identified this as a key audit matter because the estimates on which these amounts are based involve a significant degree of management judgement in interpreting the cases. Refer Note no. 37 of the Standalone Financial Statements, read with Accounting Policy No. 2.2.16.	We have obtained an understanding of the Company''s procedure in respect of estimation and disclosure of contingent liabilities and adopted the following audit procedure: • Reviewing the current status and material developments of legal matters. • Examining recent orders from competent authorities and/or communication received from various authorities, judicial forums and follow-up action thereon. • Review and analysis of evaluation of the contentions of the company through discussions, collection of details of the subject matter under consideration, the likely outcome and consequent potential outflows on those issues.
System Environment and Internal Controls The Company has SAP system in place and only FI-CO, Payroll, Financial Control, Human Capital Management, Employee Self Service / Manager Self Service (ESS / MSS) etc module are in use throughout organisation. However, Project Systems (PS), Materials Management (MM) and Document Management System (DMS) modules have been developed and rolled out at 07 project locations including corporate office. Rollout at other locations is under implementation. SD module is configured and is in advanced stage for invoicing. The IT system in the company is not fully automated and manual interventions are in place in preparing and reporting of financial statements. This required a high degree of auditor judgement in evaluating the audit evidence and a higher extent of audit effort.	Our procedures included but were not limited to: • Discussing with management and IT department on the IT environment and consideration of the key financial processes to understand where IT systems were integral to the financial reporting process. • Testing the design of the key IT controls relating to financial reporting systems of the company. • We also tested the company''s controls around system interfaces. • We applied substantive audit procedures to ensure that areas where there are manual controls are operating effectively. • Our audit planning and procedures also includes the various reports which the system generates and without which it is difficult for us to collect the data of the various heads of the Balance sheet.

Information Other than Standalone Ind AS Financial Statements and Auditor''s Report Thereon

The Company''s Board of Directors is responsible for the other information. The other information comprises the

information included in the Company''s Annual Report
but does not include consolidated financial statements,
the Standalone Ind AS Financial Statements and our
auditor''s report thereon.

Our opinion on Standalone Ind AS Financial Statements
does not cover the other information, and we do not
express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Ind AS
Financial Statements, our responsibility is to read the
other information and, in doing so, consider whether
the other information is materially inconsistent with
the Standalone Ind AS Financial Statements or our
knowledge obtained during the course of our 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.

Responsibilities of Management and Those
Charged with Governance for the Standalone Ind
AS Financial Statements

The Company''s Board of Directors is responsible for
the matters stated in section 134(5) of the Act with
respect to the preparation of these Standalone Ind AS
Financial Statements that give a true and fair view of
the financial position, financial performance, including
other comprehensive income, changes in equity and
cash flows of the Company in accordance with the
accounting principles generally accepted in India,
including the Ind AS specified under section 133 of the

Act. This responsibility also includes maintenance of
adequate accounting records in accordance with the
provisions of the Act for safeguarding of the assets of
the Company and for preventing and detecting frauds
and other irregularities; selection and application of
appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and
design, implementation and maintenance of adequate
internal financial controls, that were operating
effectively for ensuring the accuracy and completeness
of the accounting records, relevant to the preparation
and presentation of the Standalone Ind AS 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 Ind AS Financial
Statements, Management and the Board of Directors
are responsible for assessing the Company''s 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 Company''s Board of Directors is also responsible
for overseeing the Company''s financial reporting
process.

Auditor''s Responsibilities for the Audit of the
Standalone Ind AS Financial Statements

Our objectives are to obtain reasonable assurance
about whether the Standalone Ind AS Financial
Statements as a whole are free from material
misstatement, whether due to fraud or error, and to
issue an auditor''s 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 Standalone Ind AS 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 financial controls
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
system with reference to Standalone Ind AS Financial
Statements in place and the operating effectiveness
of such controls.

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

• Conclude on the appropriateness of management''s
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
Company''s ability to continue as a going concern.
If we conclude that a material uncertainty exists,
we are required to draw attention in our auditor''s
report to the related disclosures in the Standalone
Ind AS 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 auditor''s 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 Ind AS Financial
Statements, including the disclosures, and whether
the Standalone Ind AS Financial Statements represent
the underlying transactions and events in a manner
that achieves fair presentation.

Materiality is the magnitude of misstatements in
the Standalone Ind AS Financial Statements that,
individually or in aggregate, makes it probable that the
economic decisions of a reasonably knowledgeable
user of the Standalone Ind AS Financial Statements may
be influenced. We consider quantitative materiality and
qualitative factors in (i) planning the scope of our audit
work and in evaluating the results of our work; and (ii)
to evaluate the effect of any identified misstatements
in the Standalone Ind AS Financial Statements.

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
financial controls 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
Ind AS Financial Statements of the current period and
are therefore the key audit matters. We describe these
matters in our auditor''s report unless law or regulation
precludes public disclosure about the matter or when,
in extremely rare circumstances, we determine that
a matter should not be communicated in our report
because the adverse consequences of doing so would
reasonably be expected to outweigh the public
interest benefits of such communication.

Other Matters

• We did not audit the financial statements / financial
information of four (4) foreign branches included
in the Standalone Ind AS Financial Statement of
the company whose financial statements/financial
information reflect total assets of ?923.62 Crores
(Previous year ?831.76 Crores) as at 31st March 2025,
total revenue of ?357.35 Crores (Previous Year ?548.44
crores) and total PBT of ?74.63 Crores (previous year
?112.41 Crores), for the year ended on that date. The
financial statements/information of these branches
have been audited by the branch auditors whose
reports have been furnished to us and our opinion
in so far as it relates to the amounts and disclosure
included in respect of these branches, is based solely
on the reports of such branch auditors.

• The financial statements include profit/(loss) of ?0.08
Crores (Previous Year ?(-)0.08 Crores, the company''s
share in two (2) integrated joint operations
(unincorporated) accounts of which have been
audited by other firms of Chartered Accountants
and profit/(loss) of ?0.45 Crores (Previous Year
?0.90 Crores) the company''s share in one (1) joint
operation accounts of which have been certified by
the management for the year ended 31st March 2025.

• Reference is invited to Note no. 46 of the Standalone
Ind AS Financial Statements regarding amendments
made in the IndAS-116 and IndAS-117. As explained by
the Management there is no financial impact of such
amendments.

Our opinion is not modified in respect of these
matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report)
Order, 2020 ("the Order"), issued by the Central
Government 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 and 4 of the
Order to the extent applicable.

2. As required by Section 143(3) of the Act, based on
our audit we report that:

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
and proper returns adequate for the purpose of
our Audit has been received from branches not
visited by us.

c. The reports on the accounts of branch offices of
the Company audited under section 143(8) of the
Act by branch auditors have been sent to us and
have been properly dealt with by us in preparing
this report.

d. The Balance Sheet, the Statement of Profit and
Loss (including Other Comprehensive Income),
the Cash Flow Statement and the Statement of
Changes in Equity dealt with by this Report are in
agreement with the books of account.

e. In our opinion, the aforesaid Standalone Ind AS
Financial Statements comply with the Ind AS
specified under Section 133 of the Act read with
the Companies (Indian Accounting Standards)
Rules,2015 (as amended).

f. Being a government company, provision of section
164(2) of the Act are not applicable pursuant to
the notification No. G.S.R.463(E) dated 5 June
2015, issued by the Central Government.

g. 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”.

h. Being a government company, provision of
section 197 of the Act are not applicable vide
notification no. G.S.R. 463 (E) dated 5^th June 2015,
issued by the Central Government.

i. 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,
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 Ind AS Financial Statements
- Refer Note no.37 to the Standalone Ind AS
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 Refer Note
no.19.2 to the Standalone Ind AS Financial
Statements. The Company did not have any
derivative contracts.

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, as
disclosed in Note no. 45 to the accounts,
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 or entity, including foreign entity
("Intermediaries"), with the understanding,
whether recorded in writing or otherwise,
that the Intermediary shall, directly or
indirectly lend or invest in other persons or
entities identified in any manner whatsoever
("Ultimate Beneficiaries") by or on behalf
of the Company or provide any guarantee,
security or the like on behalf of the Ultimate
Beneficiaries.

b) The Management has represented that,
to the best of its knowledge and belief as
disclosed in Note no. 45 to the accounts, no
funds have been received by the Company
from any person or entity, including
foreign entity ("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 ("Ultimate Beneficiaries") by or
on behalf of the Funding Parties or provide

any guarantee, security or the like on behalf
of the Ultimate Beneficiaries.

c) Based on the 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. As stated in Accounting Policy No. 2.2.15 to
the standalone Ind AS Financial Statements

a) The final dividend proposed in the previous
year, declared and paid by the Company
during the year is in accordance with section
123 of the Companies Act 2013 to the extent
applicable.

b) The interim dividend declared and paid
by the Company during the year and until
the date of this report is in accordance with
section 123 of the Act.

c) The Board of Directors of the company
has proposed final dividend for the current
year which is subject to the approval of the
members at the ensuing Annual General
Meeting. The dividend proposed is in
accordance with section 123 of the Act to the
extent applicable.

vi. Based on our examination, which included
test checks, the Company has used
accounting software for maintaining its
books of account for the financial year
ended 31st March, 2025 which has 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 we did not come across any instance of
the audit trail feature being tampered with.

The audit trail has been preserved by the
Company as per the statutory requirements
for record retention.

3. As required by Section 143(5) of the Act and
as per directions issued by Comptroller and
Auditor General of India, we report that:

S. No	Directions	Auditor''s Replies
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.	The Company is using SAP S/4 Hana system for all its projects located in India and also in its foreign branches. As per information and explanation provided to us no accounting transactions have been processed outside the IT system except income billing for which no financial implication were observed.
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 company''s 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 this direction is also applicable for statutory auditor of lender company).	No, the Company does not have any case of restructuring of an existing loan or cases of waiver/write off of debts / loans / interest etc. made by a lender to the company. However, the IPBTL loan repayment schedule has been revised, reflecting the expected repayment of the principal amount along with interest. Appropriate accounting adjustment has been incorporated in the financial statement.
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.	According to the information and explanation given to us and as per examination of records, no funds have been received/ receivable for any specific scheme from central/state Government or its agencies during the financial year 2024-25.

For Ramesh C Agrawal & Company

Chartered Accountants
Firm Registration No: 001770C

Sd/-

CA Monika Agrawal

(Partner)

Place: New Delhi Membership No: 093769

Date: May 21, 2025 UDIN: 25093769BNLMNE5949

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Mar 31, 2024

We have audited the accompanying Standalone Ind AS Financial Statements of Ircon International Limited (“the Company") which comprise the Balance Sheet as at 31st March, 2024, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date and notes to the financial statements including a summary of the material accounting policies and other explanatory information in which are incorporated the Returns for the year ended on that date audited by branch auditors of the Company''s branches at Algeria, Bangladesh, Sri Lanka and Myanmar (hereinafter referred to as the “Standalone Ind AS Financial Statements").

We have audited the financial statements of the three (3) foreign branches situated at South Africa, Malaysia and Sri Lanka (Indian part) for the year ended 31st March, 2024. However, we have not visited any foreign branch and the relevant information for the audit purpose was provided to us by the management at corporate level.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Ind AS Financial Statements give the information required by the Companies Act, 2013 (“the Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules,2015 (“Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2024, the profit, total comprehensive income, changes in equity and its cash flows for the year ended on that date.

This report has been revised consequent upon observations of Comptroller of Auditor General of the India during the course of audit u/s 139(5) of the Companies Act, 2013 as amended, for the year ended on 31st March 2024, and this report supersedes our earlier report dated 21st May, 2024 under section 143 of the Companies Act, 2013.

Basis for Opinion

We conducted our audit of the Standalone Ind AS Financial Statements in accordance with the Standards on Auditing ("SAs") specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of the Standalone Ind AS 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 Ind AS 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 ICAI''s Code of Ethics. We believe that the audit evidence obtained by us and other auditors in terms of their reports referred to it "Other Matter" paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Ind AS Financial Statements.

Emphasis of Matters

Reference is invited to footnote no. (iii) of Note no. 8.1 of the Standalone Ind AS Financial Statements wherein it has been stated that financial statements of one of the jointly controlled entities i.e. Indian Railway Stations Development Corporation Ltd. (IRSDC) have been prepared on liquidation basis and that the Company does not foresee any impairment in the value of investments held by it in IRSDC.

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Standalone Ind AS Financial Statements of the current period. These matters were addressed in the context of our audit of the Standalone Ind AS 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.

Key Audit Matter	How our audit addressed the matter
Revenue Recognition in terms of Ind AS 115 "Revenue	- Our audit procedures included considering the
from Contracts with Customers"	appropriateness of the Company''s revenue recognition
Accounting Standard on Revenue which prescribes five	accounting policies and assessing compliance with the
steps revenue recognition model.	policies in terms of the applicable accounting standards. We evaluated the effectiveness of control over the
The Company recognizes revenue for a performance obligation satisfied over time after estimating its progress towards complete satisfaction of the performance obligation. The recognition of revenue requires assessments and judgments to be made on changes in work scope, claims (compensation, rebates etc.) and other payments to the extent performance obligation is satisfied. The company measures the performance obligation by applying input method. In the contracts where performance obligation cannot be measured	preparation of information that are design to ensure the completeness and accuracy. We selected a sample of contracts, and tested the operating effectiveness of the internal control, relating to identification of the distinct performance obligations and satisfaction of performance obligations. We also examined costs included within WIP balances on a sample basis and tested their recoverability through comparing the net realizable values as per the agreements with estimated cost to complete.
by input method, the output method is applied, which faithfully depict the Company''s performance towards complete satisfaction of the performance obligation.	- We performed following substantive procedures over revenue recognition with specific focus on whether there is single performance obligation or multiple performance obligations in the contract and whether the performance
During order fulfillment, contractual obligations may need to be reassessed. In addition, change orders or cancelations have to be considered. As a result, total	obligation is being satisfied over the period of time or at a point in time:
estimated project costs may exceed total contract	• Read, analyzed and identified the distinct performance
revenues and therefore require immediate recognition of	obligations in these contracts.
the expected loss.	• Compared these performance obligations with that
Ind AS 115 requires entities to exercise judgement, taking into consideration all of the relevant facts and circumstances when applying each step of the model to	identified and recorded by the Company. • Considered the terms of the contracts to verify
contracts with their customers.	the transaction price used to allocate to separate performance obligations.
The application of the revenue accounting standard
involves certain key judgements relating to -i. identification of distinct performance obligations;	• Checked whether the performance obligation is being satisfied over the period of time or at a point in time.
	• Performed analytical procedures for reasonableness of
ii. determination of transaction price of the identified performance obligations;	revenues disclosed
iii. the appropriateness of the basis used to measure
revenue recognized at a point in time or over time.
Additionally, revenue accounting standard contains disclosures which involves collation of information in respect of disaggregated revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. Revenue recognition from these judgements were identified as a Key Audit Matter and required a higher extent of audit effort.
Refer Note no. 39 to the Standalone Ind AS Financial Statements.

Contingent Liabilities There are a number of litigations pending before various forums against the Company and the management''s judgement is required for estimating the amount to be disclosed as contingent liability. We identified this as a key audit matter because the estimates on which these amounts are based involve a significant degree of management judgement in interpreting the cases. Refer Note no. 37 of the Standalone Financial Statements, read with the Accounting Policy No. 2.2.16.

We have obtained an understanding of the Company''s procedure in respect of estimation and disclosure of contingent liabilities and adopted the following audit procedure: • Reviewing the current status and material developments of legal matters. • Examining recent orders from competent authorities and/or communication received from various authorities, judicial forums and follow-up action thereon. • Review and analysis of evaluation of the contentions of the company through discussions, collection of details of the subject matter under consideration, the likely outcome and consequent potential outflows on those issues.

System Environment and internal Controls The Company is having SAP system in place and only FI-CO & Payroll module is Implemented and other system like inventory, MM Module etc. is under the process of implementation. Further, the SAP project system module (PS) is required to generate the projects invoices with integration support. The IT system in the company are not fully automated and manual interventions are in place in preparing and reporting of financial statements. This required a high degree of auditor judgement in evaluating the audit evidence and a higher extent of audit effort.

Our procedures included but were not limited to: • Discussing with management and IT department on the IT environment and consideration of the key financial processes to understand where IT systems were integral to the financial reporting process. • Testing the design of the key IT controls relating to financial reporting systems of the company. • We also tested the company''s controls around system interfaces. • We applied substantive audit procedures to ensure that areas where there are manual controls are operating effectively. • Our audit planning and procedures also includes the various reports which the system generates and without which it is difficult for us to collect the data of the various heads of the Balance sheet.

Information Other than the Standalone Ind AS Financial Statements and Auditor''s Report Thereon

The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Company''s Annual Report but does not include consolidated financial statements, the Standalone Ind AS Financial Statements and our auditor''s report thereon.

Our opinion on the Standalone Ind AS Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Ind AS Financial Statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the Standalone Ind AS Financial Statements or our knowledge obtained during the course of our 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.

Responsibilities of Management and Those Charged with Governance for the Standalone Ind AS Financial Statements

The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these Standalone Ind AS Financial Statements that give a true and fair view of the financial position, financial performance, including other comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Ind AS specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Ind AS 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 Ind AS Financial Statements, Management and the Board of Directors are responsible for assessing the Company''s 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 Company''s Board of Directors is also responsible for overseeing the Company''s financial reporting process.

Auditor''s Responsibilities for the Audit of the Standalone Ind AS Financial Statements

Our objectives are to obtain reasonable assurance about whether the Standalone Ind AS Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s 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 Standalone Ind AS 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 financial controls 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 with reference to Standalone Ind AS Financial Statements in place and the operating effectiveness of such controls.

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

• Conclude on the appropriateness of management''s 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 Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the

related disclosures in the Standalone Ind AS 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 auditor''s 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 Ind AS Financial Statements, including the disclosures, and whether the Standalone Ind AS Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the Standalone Ind AS Financial Statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the Standalone Ind AS Financial Statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the Standalone Ind AS Financial Statements.

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 financial controls 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 Ind AS Financial Statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Other Matters

• We did not audit the financial statements / financial information of four (4) foreign branches included in the Standalone Ind AS Financial Statement of the company whose financial statements/financial information reflect total assets of Rs. 831.76 Crores (Previous year Rs. 709.32 Crores) as at 31st March 2024, total revenue of Rs. 548.44 Crores (Previous Year Rs. 401.53 crores) and total PBT of Rs. 112.41 crores (previous year Rs. 84.32 crores), for the year ended on that date. The financial statements/information of these branches have been audited by the branch auditors whose

reports have been furnished to us and our opinion in so far as it relates to the amounts and disclosure included in respect of these branches, is based solely on the reports of such branch auditors.

• The financial statements include profit/(loss) of (-) Rs.0.08 Crores (Previous Year Rs.0.08 Crores), the company''s share in two (2) integrated joint operations (unincorporated) accounts which have been audited by other firms of chartered Accountants and profit/ (loss) of Rs.0.90 Crores (Previous Year Rs. 0.47 Crores) the company''s share in two (2) joint operations accounts certified by the management for the year ended March 2024.

• Reference is invited to Note no. 46 (ii) of the Standalone Ind AS Financial Statements regarding amendments made in the IndAS-1. As explained by the Management there is no financial impact of such amendments.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2020 ("the Order"), issued by the Central Government 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 and 4 of the Order to the extent applicable.

2. As required by Section 143(3) of the Act, based on our audit we report that:

(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 and proper returns adequate for the purpose of our Audit has been received from branches not visited by us.

(c) The reports on the accounts of branch offices of the Company audited under section 143(8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.

(d) The Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

(e) In our opinion, the aforesaid Standalone Ind AS Financial Statements comply with the Ind AS specified under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 (as amended).

(f) Being a government company, provision of section 164(2) of the Act are not applicable pursuant to the notification No. G.S.R.463(E) dated 5 June 2015, issued by the Central

Government.

(g) 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".

(h) Being a government company, provision of section 197 of the Act are not applicable vide notification no. G.S.R. 463 (E) dated 5^th June 2015, issued by the Central Government.

(i) 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, 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 Ind AS Financial Statements -Refer Note no. 37 to the Standalone Ind AS 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 Refer Note no. 19.2 to the Standalone Ind AS Financial Statements. The Company did not have any derivative contracts.

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, as disclosed in Note no. 45 to the accounts, 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 or entity, including foreign entity ("Intermediaries"), with the

understanding, whether recorded in writing or otherwise, that the Intermediary shall, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever ("Ultimate Beneficiaries") by or on behalf of the Company or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

b) The Management has represented that, to the best of its knowledge and belief as disclosed in Note no. 45 to the accounts, no funds have been received by the Company from any person or entity, including foreign entity ("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 (“Ultimate Beneficiaries") by or on behalf of the Funding Parties or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

c) Based on the 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. As stated in Accounting Policy No. 2.2.15 to

the standalone Ind AS Financial Statements

a) The final dividend proposed in the previous year, declared and paid by the Company during the year is in accordance with section 123 of the Companies Act 2013 to the extent applicable.

b) The interim dividend declared and paid by the Company during the year and until the date of this report is in accordance with section 123 of the Act.

c) The Board of Directors of the company have proposed final dividend for the current year which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend proposed is in accordance with section 123 of the Act to the extent applicable.

vi. Based on our examination, which included test checks, the Company has used accounting software for maintaining its books of account for the financial year ended 31st March, 2024 which has 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 we did not come across any instance of the audit trail feature being tempered with.

As proviso to Rule 3(1) of the Companies (Account) Rules 2014 is applicable from 1^st April 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules 2014 on preservation of audit trail as per the statutory requirements for record retention is not applicable for the financial year ended March, 2024.

3. As required by Section 143(5) of the Act and as per directions issued by Comptroller and Auditor General of India, we report that:

S. No	Directions	Auditor''s Replies
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.	The Company is using SAP S/4 Hana system for all its projects located in India and also in its foreign branches. As per information and explanation provided to us no accounting transactions have been processed outside the IT system except income billing for which no financial implication were observed.
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 company''s 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 this direction is also applicable for statutory auditor of lender company).	No, the Company does not have any case of restructuring of an existing loan or cases of waiver/write off of debts/ loans/interest etc. made by a lender to the company. However, the Company has given a loan to one of its subsidiary, Ircon PB Tollway Ltd. (IPBTL). On request of the subsidiary company, the holding company has waived off interest for the current year. However, the company has booked interest on the basis of fair valuation as per Ind AS amounting to Rs. 16.31 crores.
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.	According to the information and explanation given to us and as per examination of records, no funds have been received/ receivable for any specific scheme from Central/State Government or its agencies during the financial year 2023-24.

For Ramesh C Agrawal & Company

Chartered Accountants Firm Registration No: 001770C

Sd/-

Sanjay Agrawal

(Partner)

Date : July 01, 2024 Membership No:072867

Place: New Delhi UDIN : 24072867BKHCUG4294

---

Mar 31, 2023

Report on the Audit of the Standalone Ind AS Financial Statements

Opinion

We have audited the accompanying standalone Ind AS financial statements of IRCON INTERNATIONAL LIMITED ("the company") which comprise the Balance Sheet as at 31st March, 2023, the statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date, and a summary of the significant accounting policies and other explanatory information in which are incorporated the Returns for the year ended on that date audited by branch auditors of the Company''s branches at Algeria, Bangladesh and Sri Lanka Region.

We have audited the financial statements of the three (3) foreign branches situated at South Africa, Malaysia and Sri Lanka (Indian part) for the year ended 31st March, 2023. However, we have not visited any foreign branch and the relevant information for the audit purpose was provided to us by the management at corporate level.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Companies Act, 2013 ("the Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules,2015, as amended, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2023, the profit and total comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the Standalone Ind AS financial statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of the Ind AS 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 independence requirements that are relevant to our audit of the financial statements under the provisions of the Companies Act,2013 and the Rules made there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence obtained by us and other auditors in terms of their reports referred to it "Other Matter" paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Ind AS financial Statements.

Emphasis of Matters

We draw attention to the following notes on the Standalone Ind AS Financial Statements being matters pertaining to Ircon International Limited requiring emphasis by us.

a) Refer note no. 47 of the Standalone Financial Statements regarding certain modifications in the existing Significant Accounting Policy relating to Property, plant and equipment. As explained by the management, there is no financial impact due to such aforesaid modifications on the Company''s profitability.

b) Refer foot Note no. (iii) of note no 8.1 of the Standalone Financial Statements wherein it is mentioned that the Financials Statements of one of the Jointly controlled entities, Indian Railway Stations Development Corporation Limited (IRSDC) have been prepared on liquidation basis and that the Company does not foresee any impairment in the value of investments held by the Company in IRSDC.

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Standalone Ind AS Financial Statements of the current period. These matters were addressed in the context of our audit of the Standalone Ind AS 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.

Key Audit Matter	How our audit addressed the matter
a) Revenue Recognition in terms of Ind AS 115	Our audit procedures included considering the
"Revenue from Contracts with Customers”	appropriateness of the Company''s revenue recognition
Accounting Standard on Revenue which	accounting policies and assessing compliance with the
prescribes five steps revenue recognition model.	policies in terms of the applicable accounting standards.
The Company recognizes revenue for a performance	Evaluated the effectiveness of control over the
obligation satisfied over time after estimating its	preparation of information that are design to ensure the
progress towards complete satisfaction of the	completeness and accuracy
performance obligation. The recognition of revenue	Selected a sample of contracts, and tested the
requires assessments and judgments to be made	operating effectiveness of the internal control, relating
on changes in work scope, claims (compensation,	to identification of the distinct performance obligations
rebates etc.) and other payments to the extent	and satisfaction of performance obligations. We also
performance obligation is satisfied. The company	examined costs included within WIP balances on a sample
measures the performance obligation by applying	basis and tested their recoverability through comparing
input method. In the contracts where performance	the net realizable values as per the agreements with
obligation cannot be measured by input method, the output method is applied, which faithfully	estimated cost to complete.
depict the Company''s performance towards	We performed following substantive procedures over
complete satisfaction of the performance obligation.	revenue recognition with specific focus on whether there is single performance obligation or multiple
During order fulfillment, contractual obligations	performance obligations in the contract and whether
may need to be reassessed. In addition, change	the performance obligation is being satisfied over the
orders or cancelations have to be considered. As a result, total estimated project costs may exceed	period of time or at a point in time:
total contract revenues and therefore require	• Read, analyzed and identified the distinct
immediate recognition of the expected loss.	performance obligations in these contracts.
Ind AS 115 requires entities to exercise judgement,	• Compared these performance obligations with that
taking into consideration all of the relevant facts	identified and recorded by the Company.
and circumstances when applying each step of	• Considered the terms of the contracts to verify
the model to contracts with their customers.	the transaction price used to allocate to separate
The Further Explanation why we consider this as a	performance obligations.
Key Audit Matter is as follows:	• Checked whether the performance obligation is
The application of the revenue accounting standard	being satisfied over the period of time or at a point
involves certain key judgements relating to	in time.
identification of distinct performance obligations,	• Performed analytical procedures for reasonableness
determination of transaction price of the identified performance obligations, the appropriateness of the basis used to measure revenue recognized at a point in time or over time. Additionally, revenue accounting standard contains disclosures which involves collation of information in respect of disaggregated revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. For details refer Note No. 39 to the Standalone Ind AS Financial Statements.	of revenues disclosed

Key Audit Matter	How our audit addressed the matter
Contingent Liabilities Contingent Liabilities There are a number of litigations pending before various forums against the Company and the management''s judgement is required for estimating the amount to be disclosed as contingent liability. We identified this as a key audit matter because the estimates on which these amounts are based involve a significant degree of management judgement in interpreting the cases. (Refer Note No. 37 of the Standalone Financial Statements, read with the Accounting Policy No. 2.2.16).	We have obtained an understanding of the Company''s procedure in respect of estimation and disclosure of contingent liabilities and adopted the following audit procedure: • Reviewing the current status and material developments of legal matters. • Examining recent orders from competent authorities and/or communication received from various authorities, judicial forums and follow-up action thereon. • Review and analysis of evaluation of the contentions of the company through discussions, collection of details of the subject matter under consideration, the likely outcome and consequent potential outflows on those issues.
System Environment and internal Controls The Company is having SAP system in place and only FI-CO & Payroll module is Implemented and other system like inventory, MM Module etc. is under the process of implementation Further, the SAP project system module (PS) is required to generate the projects invoices with integration support. The IT system in the company are not fully automated and manual interventions are in place in preparing and reporting of financial statements. The Further Explanation why we consider this as a Key Audit Matter is as follows: Our audit planning & procedures also includes the various reports which the system generates and without which it is difficult for us to collect the data of the various heads of the Balance sheet.	Our procedures included but were not limited to: • Discussing with management and IT department on the IT environment and consideration of the key financial processes to understand where IT systems were integral to the financial reporting process. • Testing the design of the key IT controls relating to financial reporting systems of the company. • We also tested the company''s controls around system interfaces. • We applied substantive audit procedures to ensure that areas where there are manual controls are operating effectively.

Information Other than the Standalone Ind AS Financial Statements and Auditor''s Report thereon

The Company''s Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Company''s annual report but does not include the Standalone Ind As financial statements and our auditor''s report thereon.

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

In connection with our audit of the Standalone Ind AS financial statements, our responsibility is to read the other information and, in doing so, consider whether

the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our 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.

Responsibilities of Management and Those Charged with Governance for the Standalone Ind AS Financial Statements

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

and presentation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance, 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 read with the Companies (Indian Accounting Standards) Rules, 2015,as amended from time to time.

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.

In preparing the financial statements, management is responsible for assessing the Company''s 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.

Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.

Auditor''s Responsibilities for the Audit of the Standalone Ind AS 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 auditor''s 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 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 management''s 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 Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s 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 auditor''s 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.

Materiality is the magnitude of misstatements in the Standalone Ind AS financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the financial statements.

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 Ind AS financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Other Matters

• We did not audit the financial statements / financial information of three (3) foreign branches included in the standalone Ind AS financial statement of the company whose financial statements/financial information reflect total assets of ?515.86 Crores (Previous year ?577.99 Crores) as at 31st March 2023, total revenue of ?393.77 Crores (Previous Year ?444.69 crores) and total PBT of ?74.49 crores (previous year ?41.79 crores), for the year ended on that date, as considered in the standalone Ind AS financial statements. The financial statements/ information of these branches have been audited by the branch auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosure included in respect of these branches, is based solely on the reports of such branch auditors.

• The financial statements include profit/(loss) of ?0.08 Crores (Previous Year ?0.09 Crores), the company''s share in two (2) integrated joint operations (unincorporated) accounts which have been audited by other firms of chartered Accountants and profit/ (loss) of ?0.47 Crores (Previous Year ?0.42 Crores) the company''s share in two (2) joint operations accounts

certified by the management for the year ended March 2023.

Our opinion is not modified in respect of these matters

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2020 ("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 and 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 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 and proper returns adequate for the purpose of our Audit has been received from branches not visited by us.

c. The reports on the accounts of branch offices of the Company audited under section 143(8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.

d. The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), and the Cash Flow Statement and the Statement of Change in Equity dealt with by this Report are in agreement with the books of account.

e. In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act, read with The Companies (Indian Accounting standards) Rules, 2015.

f. Being a government company, provision of section 164(2) of the Act are not applicable pursuant to the notification No. G.S.R.463(E) dated 5 June 2015, issued by the Central Government of India.

g. 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”.

h. Being a government company, provision of section 197 of the Act are not applicable vide notification no. GSR 463 (E) dated 5th June 2015, issued by the Central Government of India.

i. 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, 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 financial statements - refer Note 37 to the standalone Ind AS 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 -Refer Note No.19.2 to the standalone Ind AS financial statements. The Company did not have any 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, as disclosed in Note No. 46 to the accounts, 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 or entity, including foreign entity ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever ("Ultimate Beneficiaries") by or on behalf of the Company or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

b) The Management has represented that, to the best of its knowledge and belief, as disclosed in Note No. 46 to the accounts, no funds have been received by the Company from any person or entity, including

foreign entity ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever ("Ultimate Beneficiaries") by or on behalf of the Funding Party or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

c) Based on the audit procedures performed 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 subclause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.

(v) As stated in Note No 2.2.15 to the standalone Ind AS financial statements

a) The final dividend proposed in the previous year, declared and paid by the company during the year is in accordance with section 123 of the Companies Act 2013 to the extent it applies to payment of divided.

b) The interim dividend declared and paid by the company during the year and until the date of this report is in accordance with section 123 of the Act.

c) The Board of Directors of the company have proposed final dividend for the current year which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend declared is in accordance with section 123 of the Act to the extent it applies to declaration of dividend.

(vi) Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company and its branches with effect from April 01, 2023, and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended March 31, 2023.

3. As required by Section 143(5) of the Act and as per directions issued by Comptroller and Auditor General of Indian, we report that:

S. No	Directions	Auditor''s Replies
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.	The Company is using SAP S/4 Hana system for all its projects located in India and also in its foreign branches. As per information and explanation provided to us no accounting transactions have been processed outside the IT system except income billing for which no financial implication were observed.
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 company''s 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 this direction is also applicable for statutory auditor of lender company).	No, the Company does not have any case of restructuring of an existing loan or cases of waiver/write off of debts/ loans/interest etc. made by a lender to the company. However, the Company has given a loan to one of its subsidiary, Ircon PB Tollway Ltd. (IPBTL). On request of the subsidiary company, the holding company has waived off interest for the current year. However, the company has booked interest on the basis of fair valuation as per Ind AS amounting to ?18.73 crores.
3.	As reported by Sect. 143(5) 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	According to the information and explanation given to us and as per examination of records, no funds have been received/ receivable for any specific scheme from central/state agencies during the financial year 2022-23.

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Mar 31, 2022

Report on the Audit of the Standalone Ind AS Financial StatementsOpinion

We have audited the accompanying standalone Ind AS financial statements of IRCON INTERNATIONAL LIMITED (‘the company”) which comprise the Balance Sheet as at 31^st March 2022, the statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date, and a summary of the significant accounting policies and other explanatory information in which are incorporated the Returns for the year ended on that date audited by branch auditors of the Company’s branches at Algeria, Bangladesh and Sri Lanka Region.

We have audited the financial statements of the three (3) foreign branches situated at South Africa, Malaysia and Sri Lanka (Indian part) for the year ended 31^st March, 2022. However, we have not visited any foreign branch and the relevant information for the audit purpose was provided to us by the management at corporate level.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Companies Act, 2013 (“the Act”) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 1 33 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31,2022, the profit and total comprehensive income, changes in equity and its cash flows for the year ended on that date.

This report has been revised consequent upon observations

of Comptroller of Auditor General of India during the course of audit u/s 139(5) of the Companies Act, 2013 as amended, for the year ended on 31^st March 2022, and this report supersedes our earlier report dated 27 May, 2022 under section 143 of the Companies Act, 2013.

Basis for Opinion

We conducted our audit of the Standalone Ind AS financial statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 201 3. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Ind AS 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 independence requirements that are relevant to our audit of the financial statements under the provisions of the Companies Act,2013 and the Rules made there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI’s Code of Ethics. We believe that the audit evidence obtained by us and other auditors in terms of their reports referred to it “Other Matter” paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Ind AS 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 Standalone Ind AS Financial Statements of the current period. These matters were addressed in the context of our audit of the Standalone Ind AS 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.

Key Audit Matter

How our audit addressed the matter

Revenue Recognition in terms of Ind AS 115 “Revenue from Contracts with Customers" Accounting Standard on Revenue which prescribes five steps revenue recognition model. The Company recognizes revenue for a performance obligation satisfied over time after estimating its progress towards complete satisfaction of the performance obligation. The recognition of revenue requires assessments and judgments to be made on changes in work scope, claims (compensation, rebates etc.) and other payments

Our audit procedures included considering the appropriateness of the Company’s revenue recognition accounting policies and assessing compliance with the policies in terms of the applicable accounting standards. Evaluated the effectiveness of control over the preparation of information that are design to ensure the completeness and accuracy Selected a sample of contracts, and tested the operating effectiveness of the internal control, relating to identification of the distinct performance obligations and satisfaction of

Key Audit Matter	How our audit addressed the matter
to the extent performance obligation is satisfied. The company measures the performance obligation by applying input method. In the contracts where performance obligation cannot be measured by input method, the output method is applied, which faithfully depict the Company’s performance towards complete satisfaction of the performance obligation. During order fulfillment, contractual obligations may need to be reassessed. In addition, change orders or cancelations have to be considered. As a result, total estimated project costs may exceed total contract revenues and therefore require immediate recognition of the expected loss. Ind AS 115 requires entities to exercise judgement, taking into consideration all of the relevant facts and circumstances when applying each step of the model to contracts with their customers. The Further Explanation why we consider this as a Key Audit Matter is as follows: The application of the revenue accounting standard involves certain key judgements relating to identification of distinct performance obligations, determination of transaction price of the identified performance obligations, the appropriateness of the basis used to measure revenue recognized at a point in time or over time. Additionally, revenue accounting standard contains disclosures which involves collation of information in respect of disaggregated revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. For details refer Note 39 to the Standalone Ind AS Financial Statements.	performance obligations. We also examined costs included within WIP balances on a sample basis and tested their recoverability through comparing the net realizable values as per the agreements with estimated cost to complete. We performed following substantive procedures over revenue recognition with specific focus on whether there is single performance obligation or multiple performance obligations in the contract and whether the performance obligation is being satisfied over the period of time or at a point in time: • Read, analyzed and identified the distinct performance obligations in these contracts. • Compared these performance obligations with that identified and recorded by the Company. • Considered the terms of the contracts to verify the transaction price used to allocate to separate performance obligations. • Checked whether the performance obligation is being satisfied over the period of time or at a point in time. • Performed analytical procedures for reasonableness of revenues disclosed
Contingent Liabilities Contingent Liabilities There are a number of litigations pending before various forums against the Company and the management’s judgement is required for estimating the amount to be disclosed as contingent liability. We identified this as a key audit matter because the estimates on which these amounts are based involve a significant degree of management judgement in interpreting the cases. (Refer Note No. 37 of the Standalone Financial Statements, read with the Accounting Policy No. 2.2.16).	We have obtained an understanding of the Company’s procedure in respect of estimation and disclosure of contingent liabilities and adopted the following audit procedure: • Reviewing the current status and material developments of legal matters. • Examining recent orders from competent authorities and / or communication received from various authorities, judicial forums and follow-up action thereon. • Review and analysis of evaluation of the contentions of the company through discussions, collection of details of the subject matter under consideration, the likely outcome and consequent potential outflows on those issues.

Key Audit Matter

How our audit addressed the matter

System Environment and internal Controls The Company is having SAP system in place and only FI-CO module is Implemented and other system like payroll, inventory etc. is under the process of implementation Further, the SAP project system module (PS) is required to generate the projects invoices with integration support. The IT system in the company are not fully automated and manual interventions are in place in preparing and reporting of financial statements. The Further Explanation why we consider this as a Key Audit Matter is as follows: Our audit planning & procedures also includes the various reports which the system generates and without which it is difficult for us to collect the data of the various heads of the Balance sheet.

Our procedures included but were not limited to: • Discussing with management and IT department on the IT environment and consideration of the key financial processes to understand where IT systems were integral to the financial reporting process. • Testing the design of the key IT controls relating to financial reporting systems of the company. • We also tested the company’s controls around system interfaces, and the transfer of data from one system to another. • We applied substantive audit procedures to ensure that areas where there are manual controls are operating effectively.

Information Other than the Standalone Ind AS Financial Statements and Auditor’s Report thereon

The Company’s Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Company’s annual report but does not include the Standalone Ind As financial statements and our auditor’s report thereon.

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

In connection with our audit of the Standalone Ind AS financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our 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.

Responsibilities of Management and Those Charged with Governance for the Standalone Ind AS Financial Statements

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 and presentation of these standalone Ind AS financial

statements that give a true and fair view of the financial position, financial performance, 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 read with the Companies (Indian Accounting Standards) Rules, 2015,as amended from time to time.

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.

In preparing the financial statements, management is responsible for assessing the Company’s 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.

Those Board of Directors are also responsible for overseeing the Company’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Standalone Ind AS 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 auditor’s 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 section143(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 management’s 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 Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to

draw attention in our auditor’s 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 auditor’s 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.

Materiality is the magnitude of misstatements in the Standalone Ind AS financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the financial statements.

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 Ind AS financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Other Matters

• We did not audit the financial statements / financial information of three (3) foreign branches included in the standalone Ind AS financial statement of the company whose financial statements/financial information reflect total assets of ''577.97 Crores (Previous year ''411.85 Crores) as at 31^st March 2022, total revenue of ''444.69 Crores (Previous Year ''518.97 crores) and total PBT of ''41.79 crores (previous year ''36.64 crores), for the year ended on that date, as considered in the standalone Ind AS financial statements. The financial statements/ information of these branches have been audited by the branch auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosure included in respect of these branches, is based solely on the reports of such branch auditors.

• The financial statements include (''0.08 Crores) (Previous Year ''17.99 Crores) profit / (loss) net, the company’s share in three integrated joint operations (unincorporated) accounts which have been certified by other firms of chartered Accountants and ''0.59 Crores (Previous Year ''0.51) profit net the company’s share in 1 joint operation account certified by the management.

Our opinion is not modified in respect of these matters

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2020 (“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 and 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 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 and proper returns adequate for

the purpose of our Audit has been received from branches not visited by us.

c. The reports on the accounts of branch offices of the Company audited under section 1 43(8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.

d. The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), and the Cash Flow Statement and the Statement of Change in Equity dealt with by this Report are in agreement with the books of account.

e. In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act, read with The Companies (Indian Accounting standards) Rules, 2015.

f. Being a government company, provision of section 164(2) of the Act are not applicable pursuant to the notification No. G.S.R.463(E) dated 5 June 2015, issued by the Central Government of India.

g. 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”.

h. Being a government company, provision of section 197 of the Act are not applicable vide notification no. GSR 463 (E) dated 5th June 201 5, issued by the Central Government of India.

i. 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, 201 4, 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 financial statements - refer Note 37 to the standalone Ind AS 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 -Refer Note No. 19.2 to the standalone Ind AS financial statements. The Company did not have any 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, as disclosed in note no 46 to the accounts, 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 or entity, including foreign entity (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever (“Ultimate Beneficiaries”) by or on behalf of the Company or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

b) The Management has represented that, to the best of its knowledge and belief, as disclosed in note no 46 to the accounts, no funds have been received by the Company from any person or entity, including foreign entity (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, directly or indirectly, lend or invest in other persons or entities identified in any manner

whatsoever (“Ultimate Beneficiaries”) by or on behalf of the Funding Party or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

c) Based on the audit procedures performed 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). As stated in note no 2.2.15 to the standalone Ind AS financial statements

a) The final dividend proposed in the previous year, declared and paid by the company during the year is in accordance with section 123 of the Companies Act 2013 to the extent it applies to payment of divided.

b) The interim dividend declared and paid by the company during the year and until the date of this report is in accordance with section 123 of the Act.

c) The Board of Directors of the company have proposed final dividend for the current year which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend declared is in accordance with section 1 23 of the Act to the extent it applies to declaration of dividend.

3. As required by Section 143(5) of the Act and as per directions issued by Comptroller and Auditor General of India, we report that:

S. No	Directions	Auditor’s Replies
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.	The Company is using SAP S/4 Hana system for all its projects located in India and also in its foreign branches. In case of foreign branches, the company implemented S/4 Hana in place of Tally software from 30th September’2021. As per information and explanation provided to us no accounting transactions have been processed outside the IT system except income billing for which no financial implication were observed.

S. No	Directions	Auditor’s Replies
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 company’s 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 this direction is also applicable for statutory auditor of lender company).	No, the Company does not have any case of restructuring of an existing loan or cases of waiver/write off of debts/loans/ interest etc. made by a lender to the company.However, the Company has given a loan to one of its subsidiary, Ircon PB Tollway Ltd. (IPBTL). On request of the subsidiary company, the holding company has waived off interest for the current year. However, the company has booked interest on the basis of fair valuation as per Ind AS amounting to ''15.45 crore.
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	According to the information and explanation given to us and as per examination of records, no funds have been received/ receivable for any specific scheme from central/ state agencies during the financial year 2021-22.

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Mar 31, 2018

1. Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of IRCON INTERNATIONAL LIMITED (“the Company”) which comprise the Balance Sheet as at 31^st March, 2018, the Statement of Profit & Loss (including Other Comprehensive Income), the Cash Flow statement & the statement of changes in equity for the year then ended, and a summary of significant accounting policies and other explanatory information in which are incorporated the Returns for the year ended on that date audited by branch auditors of the company’s branches at Northern Region, J&K region, Eastern Region, Patna Region, Mumbai Region ,South Africa, Algeria, Bangladesh, Sri-Lanka & Malaysia Region.

2. Management’s Responsibility for the Standalone Ind AS Financial Statements

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 Ind AS financial statements that give a true and fair view of the State of affairs (financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed 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 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 Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

3. Auditor’s Responsibility

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

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

We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on 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 standalone Ind AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS 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 standalone 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 Company’s Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.

We believe that the audit evidence obtained by us & other auditors in terms of their reports referred to in others matter paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

4. Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone 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 including the Ind AS, of the state of affairs (financial position) of the Company as at March 31, 2018, and its Profit (financial performance including other comprehensive income), its Cash Flow and the changes in equity for the year ended on that date.

5. Emphasis of Matters

i) We draw attention to Note No. 33 to the standalone Ind AS financial statements

a. The Company has made provision for tax without considering the deduction under Section 80-IA of Income Tax Act, 1961. However, the ITAT has disposed pending appeal for FY 2000-01 allowing deduction u/s 80IA and subsequently CIT(A) has allowed deduction for AY 2004-05, 2005-06, 2007-08, 2012-13, 2013-14 and 2014-15. The matters for other assessment years are contested by the company with the concerned authorities.

b. The company is offering global income for tax in India after excluding the income earned by its permanent establishments in foreign countries having Double Taxation Avoidance Agreements (DTAA) with India. CIT (A) denied the treatment of excluding such foreign income. Accordingly, the company has subsequently paid taxes, however the matter is contested by the company with the concerned authorities.

ii) We draw attention to Note No. 48 to the standalone Ind AS financial statements regarding non-provision of Rs. 4.96 crores towards foreign agency commission/ consultancy charges in respect of projects in three foreign countries pending assessment of the performance.

Our report is not qualified in respect of the above matters.

6. Other Matters

i) We did not audit the financial statements/information of Ten branches included in the standalone Ind AS financial statement of the company whose financial statements/financial information reflect Total Assets of Rs. 6,302.80 Crores as at 31^st March 2018, Total Revenues of Rs. 3,793.35 Crores for the year ended on that date, as considered in the standalone Ind AS financial statements. The financial statements/ information of these branches have been audited by the branch auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosure included in respect of these branches, is based solely on the reports of such branch auditors.

ii) The financial statements include the company’s share in Profit/Loss of unincorporated Joint Venture (JVs) accounts out of which four JVs accounts have been certified by other firms of Chartered Accountants and one JV (IRCON-SPSCPL) has been certified by the management.

Our opinion is not modified in respect of these matters.

7. Report on Other Legal and Regulatory Requirements

(1) As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”), issued by the Central Government of India 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.

(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 and proper returns adequate for the purpose of our Audit has been received from branches not visited by us.

c) The reports on the accounts of branch offices of the Company audited under section 143(8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.

d) The Balance Sheet, the Statement of Profit & Loss including Other Comprehensive Income, the statement of cash flows and Statement of Changes in Equity dealt with by this report are in agreement with the books of account.

e) In our opinion, the aforesaid Standalone Ind AS financial Statements comply with the Indian Accounting Standard (Ind AS) specified under section 133 of the Act, read with relevant rules issued thereunder.

f) Being a government company, provision of section 164(2) of the Act are not applicable pursuant to the notification No. G.S.R.463(E) dated 5^th June, 2015, issued by the Central Government of India.

g) 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”.

h) 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 information and according to the explanation given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements-Refer Note No.29 of the standalone Ind AS 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 -Refer Note No.16.3 to the standalone Ind AS financial statements. The Company did not have any 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.

(3) As required by Section 143(5) of the Act and as per directions issued by comptroller and Auditor General of India, we report that:

Sl. No.	Directions	Auditor’s Replies
(i)	Whether the company has clear title/ lease deeds for freehold and leasehold land respectively? If not please state the area of freehold and leasehold land for which title/lease deeds are not available.	Yes, the Company has clear title/ lease deed for freehold and leasehold land respectively except as reported in Mumbai region i.e. one lease hold building on railway land for 30 years in Pali hill Mumbai for which agreement is yet to be finalized.
(ii)	Whether there are any cases of waiver/write off of debts/loans/interest etc., if yes, the reasons thereof and the amount involved.	The Company has written-off bad assets of Rs. 0.29 Crores during the Financial Year 2017-18. (Refer Note: 22 of Financial Statement).
(iii)	Whether proper records are maintained for inventories lying with third parties & assets received as gift/ grants(s) from Govt. or other authorities.	Yes, proper records are being maintained for the inventories lying with third parties. No assets have been received as gift /grants(s) from Govt. or other authorities during the Financial Year 2017-18.

“Annexure A” to the Independent Auditors’ Report of even date on the Standalone Ind AS Financial Statements of Company for the year ended 31^st March, 2018

i. a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. In Mumbai Region, Tagging/ Numbering to be done on certain assets and assets with third parties needs to be confirmed from third party.

b) The fixed assets were physically verified by the management during the year. There is a regular program of verification, which in our opinion, is reasonable having regard to the size of the Company and nature of its business. No material discrepancies were noticed on such verifications.

c) The title deeds of immovable properties are held in the name of the Company, except one lease hold building at Pall Hill, documents for the same are yet to be executed in Mumbai Region.

ii. The inventory has been physically verified by the management at reasonable intervals during the year. In our opinion, the frequency of verification is reasonable. The discrepancies noticed on comparison of physical verification with book records were not material and have been properly dealt with in the books of account.

iii. According to the information and explanation given to us by the management and records produced, the Company has not granted any loans, secured or unsecured to companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Therefore, paragraph 3(iii) of the Order is not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us, in respect of loans, investments, guarantees and security; the provisions of section 185 and 186 of the Companies Act, 2013 have been complied with.

v. According to the information and explanations given to us, and as per our examination of records, the Company has not accepted any deposits from public and therefore, the directives issued by the Reserve Bank of India and the provisions of Section 73 to 76 or any other relevant provision of the Companies Act, 2013, and rules framed there under, are not applicable.

vi. The Company has maintained cost records as required under section 148(1) of the Companies Act, 2013. However, we are neither required to carry out, nor have carried Out any detailed examination of such accounts and records.

vii. a. The Company is generally regular in depositing undisputed statutory dues including provident fund, income tax, goods and service tax, sales tax, service-tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues applicable with the appropriate authorities. Employees’ State Insurance is not applicable to the Company. According to the information and explanation given to us, there are no undisputed statutory dues which were outstanding as on 31.03.2018 for a period of more than six months from the date the same become payable.

b. According to information and explanation given to us, and as per our examination of records of the Company, following are the particulars of dues on account of sales tax, service tax, entry tax, trade tax, income tax, duty of customs, royalty, provident fund, duty of excise and cess matters that have not been deposited on account of dispute as on 31.3.2018.

Name of the statute	Nature of disputed Dues	Amount outstanding (in Rs. Crores)	Period to which the amount relates	Forum where dispute is pending
Customs Act 1962	Customs Duty levied on machinery import from Algeria/Iraq	5.81	1989-90	Dy Commissioner (Custom), Mumbai
Central Excise Act 1944	Levy of Excise Duty on Bracket/Cantilever Assemblies	0.66	1998-99	CESTAT (Dept. Appeal)
West Bengal State Sales Tax Act	Sales Tax	0.26	1998-99	Sr. Jt. Comm. (Appeals) Sales Tax, West Bengal
Income Tax Act, 1961	Disallowance of deduction u/s 80-IA, taxing of foreign income & provision for maintenance etc.	13.52	2015-16	Commissioner of Income Tax (Appeals), New Delhi
West Bengal VAT Act, 2003	VAT	0.71	2004-05	Asst. Comm. of Sales Tax College St Charge, Kolkata
Odisha Vat Act, 2004	VAT	1.09	2002-03	Comm. of Sales Tax, Odisha
Bihar Sales Tax Act-1981	Sales Tax	1.75	1987-88 and 1994-95	Bihar Sales Tax Tribunal, Khalgoan
West Bengal VAT Act, 2003	VAT	0.54	2006-07	Joint Commissioner, Commercial Taxes, Dharamtala Circle
West Bengal VAT Act, 2003	VAT	0.28	2005-06	WB Commercial Taxes Appellate & Revisional Board
Service Tax	Service Tax on agency Fees	12.91	2010-11 to 2014-15	CESTAT
Service Tax	Service Tax on agency Fees	5.6	2009-10 to 2013-14	CESTAT
VAT	VAT TDS	5.98	2005-06 & 2006-07	Bihar VAT Department, West Circle Patna
VAT	VAT	0.07	2010-11	Bihar VAT Department, West Circle Patna
VAT	VAT	29.2	2012-13	Bihar VAT Department, West Circle Patna
Jammu and Kashmir GST Act, 1962	Sales Tax	19.33	1999-00 to 2005-06	J&K High Court, Jammu and Deputy Comm. Sales Tax (Appeals), Srinagar
Sales Tax	Sales Tax-AGRP	2.28	2007-08 to 2012-13	The Additional Commissioner, Commercial Taxes, Ghaziabad

Sales Tax	Entry Tax-AGRP	0.027	2009-10 to 2012-13	The Additional Commissioner, Commercial Taxes, Ghaziabad
Sales Tax	Entry Tax-AGRP	0.015	2013-14	The Additional Commissioner, Commercial Taxes, Ghaziabad
Sales Tax	UP TRADE TAX - UP 01	0.15	2004-05 (Entry Tax)	The Assessing Authority
Sales Tax	UP TRADE TAX - UP 01	3.74	2004-05 to 2007-08	The Assessing Authority
Sales Tax	UPTT-UP-01( Entry Tax)	0.16	2007-08	The Assessing Authority
Sales Tax	UPVAT ACT-UP-01	1.36	2007 - 08 (1.01.2008 - 31-03-2008)	The Assessing Authority
Sales Tax	UPVAT ACT-UP-01 (Entry Tax)	0.15	2008 - 09	The Appellate Authority
Sales Tax	UPVAT ACT-UP-01 (Entry Tax)	0.005	2009 - 10	The Appellate Authority
Sales Tax	UPVAT ACT-UP-01	0.011	2010 - 11	The Deputy Commissioner
Sales Tax	Sales Tax-BE-08	1.17	2008-09 to 2009-10	The Additional Commissioner, Appeal Noida
Sales Tax	Sales Tax-BE-08 Entry Tax	0.004	2008 - 09	The Additional Commissioner, Appeal Noida
Sales Tax	UPTT-UP-05	0.01	2005-06	High Court Allahabad
Sales Tax	UPTT-UP-05	1.31	2006-07 to 2007-08 (9 months)	Tribunal Jhansi Bench
Sales Tax	UPVAT-UP-05	3.26	2007-08 to 2009-10	Tribunal Jhansi Bench
Sales Tax	UPVAT-UP-05	1.55	2013-14	Dy. Commissioner Sales Tax authority, Orai
Sales Tax	UPVAT-UP-05	0.76	2014-15	Dy. Commissioner Sales Tax authority, Orai
Sales Tax	Sales Tax 2005-06-Godhra	5.47	2003-04 to 2005-06	Dy. Commissioner Sales Tax authority Vadodara
Sales Tax	Sales Tax 2010-11-GED	0.05	2010-11	Asst Commercial Tax Officer, Margo
Uttar Pradesh VAT Act, 2008	Demand Raised for Sales Tax	0.08	1982-83 & 1989-90	Appellate Authority, Jhansi
Rewari -Ajmer Project	Works contract Tax	1.84	2006-07 to 2010 - 11	High Court Rajasthan
Sales Tax	Sales Tax 1996-97 MRO	3.51	1995-96 to 1996-97	Bombay High Court

Karnataka Vat	Difference in rate of tax and levy of Interest thereon	0.5	2009-10	Deputy Commissioner (Appeals ), Trivndrum
Sales Tax	Sales tax 2010-11 MRO	0.29	2010-11	Sales Tax Office, Mumbai
Sales Tax	Sales tax 2011-12 MRO	3.68	2011-12	Sales Tax Office, Mumbai
Kerala VAT	Kerala VAT	0.33	2013-14	Asst. Commissioner, Commercial Tax
Sales Tax	UP- VAT	0.62	2010-11	Addl. Comm./ Sales Tax/Lucknow

viii. The Company has not defaulted in the repayment of loans or borrowings to any financial institution, banks, Government during the year. The company did not issue any debenture during the year.

ix. The Company has not made any public offer (including debts instruments) during the year. The term loan taken during the year was applied for the purpose for which it was taken.

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

xi. In view of the Government Notification No. GSR 463 (E) dated 5^th June, 2015, government companies are exempt from the applicability of section 197 of the Companies Act,2013. Accordingly, clause 3(xi) of the order is not applicable to the Company.

xii. The Company is not a Nidhi Company as specified in the Nidhi Rules, 2014. Thus, the requirements under para 3(xii) of the Companies (Auditor’s Report) Order 2016 are not applicable to the Company.

xiii. According to the information and explanations given to us, all transactions with related parties are in compliance with section 177 and 188 of the Companies Act, 2013 where applicable and the details have been disclosed in the financial statements etc., as required by the applicable accounting standards.

xiv. According to the information and explanations given to us, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review.

xv. According to the information and explanations given to us, the Company has not entered into non-cash transactions with the directors or persons connected with him, within the provisions of section 192 of the Companies Act, 2013.

xvi. The Company is not a Non-banking finance company, hence registration under section 45-IA of the Reserve Bank of India Act, 1934 does not arise.

“Annexure B” to the Independent Auditors’ Report of even date on the Standalone Ind AS Financial Statements of Ircon International Limited for the year ended 31^st March, 2018

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 controls over financial reporting of Ircon International Limited “the Company” as of March 31, 2018 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s 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 (ICAI)”. 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’s 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.

Auditor’s Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both issued by the Institute of Chartered Accountants of India. 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 auditor’s 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 audit opinion on the Company’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company’s internal financial control over financial reporting 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 company’s 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 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 company’s assets that could have a material effect on the 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 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 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.

Qualified Opinion

According to the information and explanations given to us and based on our audit and branch auditor’s audit report, the following material weaknesses have been identified as at March 31, 2018.

(a) The Company has an integrated ERP system which was not used at its full potential. In the foreign projects the company has not used ERP system for the preparation of financial accounts instead software “Tally” was used for the same. In the Mumbai region the branch auditor has reported that integrated ERP system is not used to its fullest potential and in one project software tally was used for preparation of Financial Statement. The ERP system should have been used at its full potential to have more effective financial control.

(b) The Inventory records at some units is maintained manually and the inventory manual in SAP is under consideration. Further continuous identification system of surplus/obsolete/broken assets and material/stores is inadequate and needs to be strengthened.

A material weakness’ is a deficiency, or a combination of deficiencies in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

In our opinion, except for the effects/ possible effects of the material weaknesses described above on the achievement of the objectives of the control criteria, 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 March 31, 2018, “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”.

Emphasis of Matter

Few cases of reduction of bills by the client and accepted by the project without noting therein full reasons/ justifications have been observed for which follow up with client needs to be improved.

Other Matters

Our aforesaid report under section 143(3)(i) of the Act on the adequacy and operating effectiveness of the internal financial controls over financial reporting insofar as it relates to a branches/Region, is based on the corresponding report of other auditors.

For K.G SOMANI & CO.

Chartered Accountants

FRN 006591N

(Ashish Kumar Batta)

Partner

Membership No.095597

Place of Signature: New Delhi

Date: 03^rd August 2018

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Mar 31, 2011

1. We have audited the attached Balance Sheet of Ircon International Limited as at list March, 2011, Profit &l Lose Account and Cash flow statement for the year ended on that date, annexed thereto in which are incorporated the accounts of Algeria, Mozambique, Ethiopia. Afghanistan. Sri Lanka. Northern, Western, Eastern, Southern, Kanpur and Jammu & Kashmir Regions of the Company audited by the Branch Statutory Auditors duly appointed and whose reports have been considered by us in framing our 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 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 statement. An audit also audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis of our option.

3. As required by the companies (Auditor''s Report) Order, 2003 issued by the Government of India in terms of section 227 (4A) of the Companies Act. 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. We draw attention to Notes to Accounts (Scheduler'') & Significant Accounting Policies (Schedule "Q")

a) Note No.12.b): Carrying balances at exchange rate prevalent at the time of settlement of dues in 1995 with Government of India and not translating at rates prevalent on 31.03.2011 is not in conformity with AS-11, As a result, other current assets is lower by Rs 7.49 crores, provisions is lower by Rs 3.54 crores and profit is lower by Rs 3.95 crores.

b) Note No. 20: During the year the company has changed the accounting policy for " Provision for Design Guarantee after the maintenance period." Due to such change, profit for the year is lower by Rs 129.69 crores, and current liability and provision is higher by Rs 129.69 crores.

c) Note No,. 21; During the year the company has changed the procedure of changing Drawings. Design & Consultancy expenses Earlier it was being charged on turnover basis whereas now it has been charged on services rendered basis. Due to this change, the turnover of the Company has increased this year by Rs 118 crores, Drawings. Design & Consultancy expenses increased by Rs 83.06 crores, profit increased by Rs 34.94 crores, Current Liabilities reduced by Rs 47.73 crores and Current Assets reduced by Rs 12.79 crores.

5. Further to our comments in annexure referred tom para 3 above and subject to clause (a), (b) and (c} of para 4, 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 audit

b) In our opinion, the Company has kept proper books of accounts as required by law so far as appears from our examination of those books,

c) The Balance Sheet and Profit & Loss Account dealt with by this report are in agreement with the books of accounts..

d) In our opinion. the Balance Sheet, Prof it and Loss account and Cash Flow Statement dealt with by this Report comply with accountings standards referred to in sub-section (3c) of section 211 of the companies Act, 1956 except otherwise stated.

e) Being a Government Company, pursuant to the Gazette notification No. GSR 829(E) dated 21.10.2003 issued by Government of India, provisions of clause(g) of sub-section (l)of section 274 of the Compantes Act, 1956, are not applicable to the company,

f) in our opinion and according to the best of our information and according to the explanations given to us. the said accounts read with Significant Accounting Policies (Schedule-Q) and Notes on Accounts (Schedule-R) give the information required by the Companies Act, 1956, in the manner so required and gives a true and fair view in conformity with the accounting principles generally accepted in India.

i) In the case of Balance sheet, of the state of affairs of the company as at 31.03.2011;

ii) In the case of profit & Loss account, of the profit for the year ended on that date; and

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

i. 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 by the management during the year, There is a regular programme of verification, which in our opinion, is reasonable having regard to the size of the Company and nature of its business. No material discrepancies were noticed on such verifications.

c. During the year no substantial disposal of fixed assets of the Company has taken place which would have affected its going concern status.

ii a. The inventory has been physically verified by the management at reasonable intervals during the year. In our opinion, the frequency of verification is reasonable.

b. In our opinion and according to the information and explanation given to us, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the company and nature of its business.

c. On the basis of our examination of records of inventory, we are of the opinion that the Company is maintaining proper records of inventory. The discrepancies noticed on comparison of physical verification results with the book records are not material and have been properly dealt with in the books of account.

iii. According to the information and explanation given to us by the management and records produced, the company has neither granted nor taken any loans, secured or unsecured to / from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.Thus, the requirements under para 4(iii) (b) to (d) of the Companies (Auditor''s Report) Order 2003 are not applicable to the Company,

IV. In Our Opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business, for purchase of inventory and fired assets and for the sale of goods and services During the course of our audit we have not observed any continuing failure to correct major weakness in the internal control.

v. According to the information and explanations given to us by the management and records produced, there are no transactions that need to be entered into the register pursuant to Section 301 of the Companies Act, 1956.

vi. According to the information and explanations given to us, and as per our examination of records, the Company has not accepted any deposits from public and therefore, the directives issued by the Reserve Bank of India and the provisions of Section 58A and 58AA or any other relevant provision of the Companies Act, 1956, and rules framed there under; are not applicable.

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

viii. The Central Government has not prescribed the maintenance of cost records under section 209(l)[d) of the companies Act, 1956, in respect of the company.

ix. a. The company is generally regular in depositing undisputed statutory dues with appropriate Authority including provident fund, income tax, sales tax, wealth -tax, service-tax, custom duty, excise duty, cess and other statutory dues applicable with the appropriate authorities. The investor Education & Protection Fund and Employees'' state Insurance are not applicable to the company. According to the information and explanation given to us, there are no undisputed statutory dues which were outstanding as on 31.03.2011 for a period over six months from the date the same become payable except Rs 0.03 crores being undisputed Sales Tax liability of OFC Bangalore Project outstanding for more than six months.

b. According to information and explanation given to us, and as per our examination of records of the Company following are the particulars of dues on account of sales tax, entry tax, trade tax, income tax custom duty, royalty, wealth tax, provident fund, excise duty and cess matters that have not been deposited on account of dispute as on 31.3.2011.

Nature of the dues Amount (in Rs crores) Period for which amount relate Forum where pending

Sales Tax 1.99 1995-96 Maharashtra Sales Tax Tribunal, Sales Tax 1.53 1996-97 Mumbai

Royalty 0.02 1984-85 and 1985-86 High Court, Allahabad

Sales Tax 0.99 2002-03 Commissioner Sales Tax, Orissa

Sales Tax 0.03 1993-94 High Court, M.P

Sales Tax 0.87 1997-2002 Asst Commissioner Sales Tax, Sales Tax 0.71 2003-04 & 2004-05 Behaja

Sales Tax 1.75 1987-88 to 1994-95 Bihar Sales Tax Tribunal

Sales Tax 1.50 2009-10 Dy Commissioner Appeal, Ajmer

Spl Secretary, Mining Department, Cess 8.35 2001-02 Rajasthan

Sales Tax 0.21 1997-98 Revenue Board, Gwalior

Sales Tax 0.56 2007-08 High Court, Allahabad

Sales Tax 0.52 2010-11 Dy. Commissioner, Sales Tax, Noida

Sales Tax 1.19 2006-07 Dy. Commissioner (Appeals). Punjab Sales Tax

Provident Fund 1.75 2003-04 to 2006-07 Provident Fund Commissioner, J & K

Sales Tax 55.23 2001-02 to 2006-07 Dy Commissioner of Sales Tax (Appeals), J & K

Entry Tax 0.07 2007-03 Jt. Commissioner Appeals Jhansi

UPTT 1.45 2007-08 Dy. Commissioner of Sales Tax, Orai

Entry Tax 0.03 2009-10 Dy Commissioner Sales Tax, Lucknow

Sales Tax 0.01 2005-06

Sales Tax 0.23 2002-03 High Court/Allahabad

Sales Tax 0.18 2003-04

Sales Tax 0.41 2004-05

Entry Tax 0.15 2006-07 Jt Commissioner Appeals, Jhansi

UPTT 0.43 2006-07 Tamil Nadu Sales Tax Appellate Sales Tax 0.06 1995-96 to 2000-01 Tribunal, Chennai

Sales Tax 0.08 1982-83,1987-88 & 1989-90 DC (Appeal) Jhansi

Custom Duty 5.81 1989-90 Dy Commissioner (Custom), Mumbai

* However, an amount of Rs 16.67 crores had been deposited under protest to the department.

x. The company has no cash losses during the financial year covered by out audit and in the immediately preceding financial year nor are there any accumulated losses in this period.

xi. The Company is a debt free company, so the question of default by the Company in repayment of dues to financial institution, bank or debenture holder does not arise.

xii. According to the information and explanations given to us and as per our examination of records., the company has not granted loans and advances on the pledge of shares, debentures and other securities.

xiii. In. our opinion, the Company is neither a chit fund nor a nidhi mutual benefit fund/society so the provisions of clan se 4(xiii) of the Companies (Auditor''s Report) Order, 2003 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 Companies (Auditor''s Report} Order 2003, are not applicable to the Company.

xv. In our opinion, the terms and conditions on winch the Company has given guarantees for loans taken by others from banks or financial institutions are not prejudicial to the interest of the Company,

xvi. The Company is a debt free Company, so the question of use by the Company of term loan for the purpose for which it was given, does not arise.

xvii. As the company is a debt free company, the use of short-term funds for long-term investment does not arise.

xvii. According to the information and explanations given to us, the Company has not made preferential allotment of shares to parties and companies cove red in the register maintained under section 301 of the Act

xix. According to the information and explanations given to us, during the year under audit the Company has not issued any debentures.

xx. The company has not raised any money by way of public issue during the year.

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

For WAHI & GUPTA

Chartered Accountants

FRN : 2263N

K.P. WAHI

Partner

M.No.16164

Place : New Delhi

Date : 10.08.2011

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Mar 31, 2010

1. We have audited the attached Balance Sheet of Ircon International Limited as at 31st March, 2010, Profit & Loss Account and Cash flow statement for the year ended on that date, annexed thereto in which are incorporated the accounts of Algeria, Mozambique, Ethiopia, Afghanistan, Sri Lanka, Northern Region, Western, Eastern, Southern, Kanpur & Jammu & Kashmir Regions of the Company audited by the Branch Statutory Auditors duly appointed and whose reports have been considered by us in framing our report.

These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with 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 the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis of our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 issued by the Government of India in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. We draw attention to Notes to Accounts (Schedule R) & Significant Accounting Policies (Schedule "Q")

a) Nofe No. 12.b): Carrying balances at exchange rate prevalent at the time of settlement of dues in 1995 with Government of India and not translating at rates prevalent on 31.03.2010 is not in conformity with AS-11. As a result, other current assets is lower by Rs.80.86 million, provisions is lower by Rs.38.21 million and profit is lower by Rs. 42.65 million.

5. Further to our comments in annexure referred to in para 3 above and subject to clause (a) of para 4, 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 audit.

b) In our opinion, the Company has kept proper books of accounts as required by law so far as appears from our examination of those books.

c) The Balance Sheet and Profit & Loss Account dealt with by this report are in agreement with the books of accounts.

d) In our opinion, the Balance Sheet, Profit and Loss account and Cash Flow Statement dealt with by this Report comply with accounting standards referred to in sub-section (3c) of section 211 of the Companies Act, 1956 except otherwise stated .

e) Being a Government Company, pursuant to the Gazette notification No. GSR 829(E) dated 21.10.2003 issued by Government of India, provisions of clause(g) of sub-section (1) of section 274 of the Companies Act, 1956, are not applicable to the company.

f) In our opinion and according to the best of our information and according to the explanations given to us, the said accounts read with Significant Accounting Policies (Schedule-Q) and Notes on Accounts (Schedule-R) give the information required by the Companies Act, 1956, in the manner so required and gives a true and fair view in conformity with the accounting principles generally accepted in India.

i) In the case of Balance Sheet, of the state of affairs of the Company as at 31.03.2010;

ii) In the case of Profit & Loss account, of the profit for the year ended on that date; and

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

ANNEXURE TO THE AUDITORS REPORT (Referred to in paragraph (3) thereof)

i. 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 by the management during the year. There is a regular programme of verification, which in our opinion, is reasonable having regard to the size of the Company and nature of its business. No material discrepancies were noticed on such verifications.

c. During the year no substantial disposal of fixed assets of the Company has taken place which would have affected its going concern status.

ii. a. The inventory has been physically verified by the management at reasonable intervals during the year. In our opinion, the frequency of verification is reasonable.

b. In our opinion and according to the information and explanation given to us, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the company and nature of its business.

c. On the basis of our examination of records of inventory, we are of the opinion that the Company is maintaining proper records of inventory. The discrepancies noticed on comparison of physical verification results with the book records are not material and have been properly dealt with in the books of account.

iii. According to the information and explanation given to us by the management and records produced, the Company has neither granted nor taken any loans, secured or unsecured to/from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Thus, the requirements under para 4(iii) (b) to (d) of the Companies (Auditors Report) Order 2003 are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business, for purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weakness in the internal control.

v. According to the information and explanations given to us by the management and records produced, there are no transactions that need to be entered into the register pursuant to Section 301 of the Companies Act,

vi. According to the information and explanations given to us, and as per our examination of records.the Company has not accepted any deposits from public and therefore, the directives issued by the Reserve Bank of India and the provisions of Section 58A and 58AA or any other relevant provision of the Companies Act, 1956, and rules framed there under, are not applicable.

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

viii. The Central Government has not prescribed the maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956, in respect of the Company.

ix. a. The company is generally regular in depositing undisputed statutory dues with appropriate Authority including provident fund, income tax, sales tax, wealth-tax, service-tax, custom duty, excise duty, cess and other statutory dues applicable with the appropriate authorities. The investor Education & Protection Fund and Employees State Insurance are not applicable to the company. According to the information and explanation given to us, there are no undisputed statutory dues which were outstanding as on 31-03-2010 for a period over six months from the date the same become payable.

b. According to information and explanation given to us, and as per our examination of records of the Company following are the particulars of dues on account of sales tax, income tax, custom duty, wealth tax, excise duty and cess matters that have not been deposited on account of dispute as on 31.3.2010.



Nature of the Amount (in Period for Forum where dues Rs. Million) which pending amount relate Sales Tax 10.61 1988-90 ACIT Delhi

VAT 203.07 2007-09 Commissioner VAT, Delhi

Sales Tax 0.81 1982-83, 1987-88 & DC (Appeal) Jhansi 1989-90

Custom Duty 58.12 1989-90 Dy Commissio ner(Custom), Mumbai

Sales Tax 19.90 1995-96 Maharashtra Sales Tax

Sales Tax 15.27 1996-97 Tribunal, Mumbai

Sales Tax 0.03 1995-96 Tamil Nadu Sales Tax

Sales Tax 0.26 2000-2001 Appellate Tribunal, Chennai

Sales Tax 0.31 2001-2001

Sales Tax/VAT 2.31 1998-1999 Addl Commissioner, (Commercial Tax)Satna

Sales Tax/VAT 0.11 1999-2000 Addl Commissioner, (Commercia Tax)Satna

Royalty 0.19 1984-85 and 1985-86 High Court, Allahabad

Sales Tax 9.94 2002-03 Commissioner Sales Tax, Orissa

Sales Tax 0.35 1993-94 High Court, M.P.

Sales Tax 0.05 1998-99 Addl. Commissioned Commercial Tax) Raipur & Korba,

Sales Tax 8.63 1997-2002 Asst Commissioner Sales

Sales Tax 7.13 2003-04 & 2004-05 Tax, Behala

Sales Tax 1.7.5 1987-88 to 1994-95 Bihar Sales Tax Tribunal

Sales Tax 360.03 2001-02 to 2005-06 Dy Commissioner of Sales Tax (Appeals),J&K

Sales Tax 11.93 2006-07 Dy Commissioner (Appeals), Punjab Sales Tax

Provident Fund 17.54 2003-04 to 2006-07 Provident Fund Commissioner, J&K

Sales Tax 2.12 1997-98 Revenue Board, Gwalior

Sales Tax 114.64 2001-05 Dy Commissioner, Noida

Sales Tax 7.32 2009-10 Dy Commissioner Appeal, Ajmer

Cess 83.50 2001-02 Spl Secretary. Mining Department, Rajastan

UPVAT 4.96 2009-10

Entry Tax 0.71 2007-08 Jt. Commissioner Appeals

Sales Tax 14.52 2006-07 Jhansi

Entry Tax 3.41 2006-07

Entry Tax 0.l6 2005-06

Entry Tax 0.33 2009-10 Dy Commissioner Sales Tax, Lucknow

Sales Tax 0.14 2005-06

Sales Tax 2.80 2002-03 High Court/ Allahabad.

Sales Tax 1.84 2003-04

Sales Tax 4.07 2004-05



x. The company has no cash losses during the financial year covered by our audit and in the immediately preceding financial year nor are there any accumulated losses in this period.

xi. The Company is a debt free company, so the question of default by the Company in repayment of dues to financial institution, bank or debenture holder does not arise.

xii. According to the information and explanations given to us and as per our examination of records, the company has not granted loans and advances on the pledge of shares, debentures and other securities.

xiii. In our opinion, the Company is neither a chit fund nor a nidhi mutual benep fund/society, so the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 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 Companies (Auditors Report) Order 2003, are not applicable to the Company.

xv. In our opinion, the terms and conditions on which the Company has given guarantees for loans taken by others from banks or financial institutions are not prejudicial to the interest of the Company.

xvi. The Company is a debt free Company, so the question of use by the Company of term loan for the purpose for which it was given, does not arise.

xvii. As the Company is a debt free company, the use of short-term funds for long-term investment does not arise.

xviii. According to the information and explanations given to us, the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

xix. According to the information and explanations given to us, during the year under audit, the Company has not issued any debentures.

xx. The Company has not raised any money by way of public issue during the year.

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

For Wahi & Gupta Chartered Accountants FRN 2263N

(Y.K.Gupta) Partner Membership No. 16020

Place; New Delhi

Date: 6th August 2010