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HCL Technologies

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Auditor's Report (HCL Technologies) Year End : Mar '17

Report on the standalone Ind As Financial statements

We have audited the accompanying standalone Ind AS financial statements of HCL Technologies Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the 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 financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act., read with Rule 7 of the Companies (Accounts) Rules, 2014 and the Companies (Indian Accounting Standards) Rules, 2015, as amended. 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 the design, implementation and maintenance of adequate internal financial control that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

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, issued by the Institute of Chartered Accountants of India, as 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 financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the 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 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 we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the 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, of the state of affairs of the Company as at March 31, 2017, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.

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 sub-section (11) of section 143 of the Act, we give in the Annexure 1 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;

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

(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 Companies (Indian Accounting Standards) Rules, 2015, as amended;

(e) On the basis of written representations received from the directors as on March 31, 2017 and taken on record by the Board of directors, we report, that except for one director (since deceased) for whom the written representation is not available with the Company, none of the remaining directors is disqualified as on March 31, 2017, from being appointed as a director in terms of Section 164(2) of the Act.

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure 2” to this report;

(g) 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 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;

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on longterm contracts including derivative contracts

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company

iv. The Company has provided requisite disclosures in Note 3.37 to these standalone Ind AS financial statements as to the holding of Specified Bank Notes on November 8, 2016 and December 30, 2016 as well as dealings in Specified Bank Notes during the period from November 8, 2016 to December 30, 2016. Based on our audit procedures and relying on the management representation regarding the holding and nature of cash transactions, including Specified Bank Notes, we report that these disclosures are in accordance with the books of accounts maintained by the Company and as produced to us by the Management.

Annexure 1 referred to in paragraph 1 of the section on “Report on other Legal and Regulatory Requirements” of our report of even date

Re: HcL Technologies Limited (the company)

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

(b) All property, plant and equipment were physically verified by the management in accordance with a planned programme of verifying them in phased manner over a period of three years, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification conducted during the financial year.

(c) According to the information and explanations given by the management, the title deeds of immovable properties, included in property, plant and equipment are held in the name of the company, except for the immovable properties acquired during demerger of Geometric Limited in the current year. As explained to us, registration of title deeds is in progress in respect of an immovable property acquired during the year aggregating Rs.442,232,704.

(ii) The management has conducted physical verification of inventory at reasonable intervals during the financial year and no material discrepancies were noticed on such physical verification.

(iii) According to the information and explanations given to us, 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. Accordingly, the provisions of clause 3(iii)(a), (b) and (c) of the Order are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to us, provisions of section 186 of the Companies Act 2013 in respect of loans given have been complied with by the company. In our opinion and according to the information and explanations given to us, there are no loans, investments, guarantees, and securities given in respect of which provisions of section 185 of the Companies Act 2013 are applicable and hence not commented upon.

(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended).

Accordingly, the provisions of clause 3(v) of the Order are not applicable.

(vi) To the best of our knowledge and as explained, the Central Government has not specified the maintenance of cost records under clause 148(1) of the Companies Act, 2013, for the products / services of the Company.

(vii) (a) Undisputed statutory dues including provident fund, employees’ state insurance, income-tax, sales-tax, service tax, duty of custom, duty of excise, value added tax, cess and other material statutory dues have generally been regularly deposited with the appropriate authorities though there has been a slight delay in a few cases.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees’ state insurance, income-tax, service tax, sales-tax, duty of custom, duty of excise, value added tax, cess and other statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

(c) According to the records of the Company, the dues of income-tax, sales-tax, service tax, duty of custom, duty of excise , value added tax and cess on account of any dispute, are as follows:

Name of the statute

Nature of Dues

Amount (Rs.)

period to which the amount relates

Forum where dispute is pending

Income Tax Act, 1961

Income Tax

20,953,010

2012-13

Commissioner of Income Tax (Appeals)

Income Tax Act, 1961

Income Tax

181,930,009

2011-12

Commissioner of Income Tax (Appeals)

Income Tax Act, 1961

Income Tax

24,633,600

2010-11

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

651,895,734

2009-10

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

600,132,571

2008-09

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

6,590,943

2008-09

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

2,158,713,936

2006-07

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

1,929,049,267

2005-06

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

67,125,480

2004-05

Delhi High Court

Income Tax Act, 1961

Income Tax

165,049,926

2004-05

Commissioner of Income Tax (Appeals)

Income Tax Act, 1961

Income Tax

11,076,982

2004-05

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

16,380,906

2004-05

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

149,282,681

2004-05

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

69,666,262

2004-05

Supreme Court

Income Tax Act, 1961

Income Tax

5,485,365

2004-05

Commissioner of Income Tax (Appeals)

Income Tax Act, 1961

Income Tax

486,564,233

2003-04

Supreme Court

Income Tax Act, 1961

Income Tax

83,641,252

2003-04

Delhi High Court

Income Tax Act, 1961

Income Tax

19,845,000

2003-04

Delhi High Court

Income Tax Act, 1961

Income Tax

42,207,150

2003-04

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

23,431,665

2003-04

Supreme Court

Income Tax Act, 1961

Income Tax

72,785,447

2003-04

Commissioner of Income Tax (Appeals)

Income Tax Act, 1961

Income Tax

237,007,827

2002-03

Delhi High Court

Income Tax Act, 1961

Income Tax

29,453,054

2002-03

Supreme Court

Income Tax Act, 1961

Income Tax

122,808,192

2002-03

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

1,890,000

2002-03

Delhi High Court

Income Tax Act, 1961

Income Tax

77,694,954

2001-02

Supreme Court

Income Tax Act, 1961

Income Tax

84,291,415

2001-02

Income Tax Appellate Tribunal

Income Tax Act, 1961

Income Tax

3,220,000

2000-01

Delhi High Court

Income Tax Act, 1961

Income Tax

4,373,578

2000-01

Supreme Court

Income Tax Act, 1961#

Income Tax

53,670

2011-12

Commissioner of Income Tax (Appeals)

Income Tax Act, 1961#

Income Tax

14,044,848

2010-11

Commissioner of Income Tax (Appeals)

Income Tax Act, 1961#

Income Tax

183,891,731

2009-10

Commissioner of Income Tax (Appeals)

Income Tax Act, 1961#

Income Tax

3,027,465

2008-09

Commissioner of Income Tax (Appeals)

Income Tax Act, 1961#

Income Tax

4,559,970

2007-08

Income Tax Appellate Tribunal

Income Tax Act, 1961#

Income Tax

125,533,617

2005-06

Income Tax Appellate Tribunal

Income Tax Act, 1961#

Income Tax

722,591

2004-05

Commissioner of Income Tax (Appeals)

Income Tax Act, 1961#

Income Tax

150,640

2003-04

Commissioner of Income Tax (Appeals)

Income Tax Act, 1961*

Income Tax

77,071,478

2012-13

Dispute Resolution Panel

Income Tax Act, 1961*

Income Tax

86,696,401

2011-12

Income Tax Appellate Tribunal

Income Tax Act, 1961*

Income Tax

61,761,471

2010-11

Income Tax Appellate Tribunal

Income Tax Act, 1961*

Income Tax

113,797,530

2009-10

Income Tax Appellate Tribunal

Income Tax Act, 1961*

Income Tax

146,892,993

2008-09

Income Tax Appellate Tribunal

Income Tax Act, 1961*

Income Tax

17,300,596

2007-08

Income Tax Appellate Tribunal

Income Tax Act, 1961*

Income Tax

28,485,115

2006-07

Income Tax Appellate Tribunal

Customs Act, 1962

Custom Duty

2,717,465

2006-07

Common Adjudicating Authority (Directorate of Revenue Intelligence)

Customs Act, 1962

Custom Duty

10,855,181

2005-06

Customs & Excise Applate Tribunal, Bangalore

Customs Act, 1962*

Custom Duty

3,451,999

2009-14

Office of Asstt. Commissioner of Customs

Customs Act, 1962*

Custom Duty

940,568

2009-14

Office of Asstt. Commissioner of Customs

Customs Act, 1962*

Custom Duty

3,648,840

2007-08

Office of Asstt. Commissioner of Customs

Customs Act, 1962*

Custom Duty

18,000

1999-00

Office of Asstt. Commissioner of Customs

Customs Act, 1962*

Custom Duty

2,808,670

1998-99

Office of Asstt. Commissioner of Customs

Customs Act, 1962*

Custom Duty

14,690,000

1997-98

Office of Asstt. Commissioner of Customs

Central Excise Act 1944

Excise Duty

20,045,546

2011-12

Commissioner Appeals, Central Excise, Chennai

Central Excise Act 1944*

Excise Duty

161,016

1997-98

Office of Asstt. Commissioner of Customs

Central Excise Act 1944*

Excise Duty

1,074,000

1999-00

Office of Asstt. Commissioner of Customs

Finance Act 1994, read with Service Tax Rules, 1994

Service Tax

23,801,429

2013-15

CESTAT, Allahabad

Finance Act 1994, read with Service Tax Rules, 1994

Service Tax

73,212,938

2010-13

CESTAT, Allahabad

Finance Act 1994, read with Service Tax Rules, 1994

Service Tax

659,367

2009-10

Customs ,Excise, Service Tax Appellant Tribunal, Allahabad

Finance Act 1994, read with Service Tax Rules, 1994

Service Tax

1,821,541

2006-11

Customs ,Excise, Service Tax Appellant Tribunal, Allahabad

Finance Act 1994, read with Service Tax Rules, 1994

Service Tax

34,327,784

2006-07

Commissioner (Appeals)

Finance Act 1994, read with Service Tax Rules, 1994

Service Tax

13,024,724

2006-07

Customs ,Excise, Service Tax Appellant Tribunal, Allahabad

Finance Act 1994, read with Service Tax Rules, 1994*

Service Tax

4,391,000

1997-99

Office of Asstt. Commissioner of Customs

Central Board Trustees*

Provident fund

43,047,769

1996-14

Bombay High Court

Above amount represents total demand inclusive of interest .Total amount deposited / adjusted in respect of Income tax is Rs.1,215,393,582, Custom Duty Rs.8,023,817 and Service tax is Rs.46,010,138.

# Pursuant to scheme for demerger of IT enabled business of HCL Comnet Systems & Services Limited in FY 2012 -13.

* Pursuant to acquisition of demerged business of Geometric Limited in FY 2016-17

(viii) In our opinion and according to the information and explanations given by the management, the Company has not defaulted in repayment of loans or borrowing to a bank. The Company did not have any outstanding loans or borrowing dues in respect of financial institution or government or dues to debenture holders.

(ix) According to the information and explanations given by the management, the Company has not raised any money way of initial public offer / further public offer / debt instruments hence, reporting under clause is not applicable to the Company and hence not commented upon. In our opinion and according to information and explanations given by the management, term loans were applied for the purpose for which they were raised.

(x) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no fraud by the company or no fraud / material fraud on the company by the officers and employees of the Company has been noticed or reported during the year.

(xi) According to the information and explanations given by the management, the managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013.

(xii) In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3(xii) of the order are not applicable to the Company and hence not commented upon.

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

(xiv) According to the information and explanations given to us and on an overall examination of the balance sheet, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and hence, reporting requirements under clause 3(xiv) are not applicable to the company and, not commented upon.

(xv) According to the information and explanations given by the management, the Company has not entered into any noncash transactions with directors or persons connected with him as referred to in section 192 of Companies Act, 2013

(xvi) According to the information and explanations given to us, the provisions of section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company.

For S.R. BATLIBOI & CO. LLP

Chartered Accountants

ICAI Firm registration number: 301003E / E300005

per Tridibes Basu

Partner

Membership Number: 17401

Place: Gurgaon

Date: May 11, 2017

Source : Dion Global Solutions Limited
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