Ola Electric Mobility Limited has addressed concerns raised about its internal financial controls (IFC) following a news article highlighting scrutiny over inventory controls. The company clarified that the observation pertains to a specific instance within its subsidiary, Ola Electric Technologies Private Limited, and does not reflect broader issues within the organization.
The concern was raised by the Statutory Auditors, M/s B S R & Co. LLP, regarding the physical verification of inventory at Ola Electric Technologies Private Limited. While the auditors brought this to the attention of shareholders, they also issued an unqualified opinion, affirming that the financial statements of the company present a true and fair view of its financial position on both standalone and consolidated bases.
Ola Electric emphasized its commitment to strong internal controls and corporate governance, stating that its existing framework ensures operational excellence, financial integrity, and regulatory compliance. The company believes it has a well-established IFC framework and remains dedicated to maintaining robust controls.
In Q4 FY25, Ola Electric redesigned its network operations to enhance operational and cost efficiency. As part of this initiative, there was a temporary realignment of inventory processes, which the Statutory Auditors commented on. The company clarified that the matter reported by the auditors relates to a single transaction where physical verification of inventory at Ola Electric Technologies Private Limited could not be conducted due to the ongoing realignment. However, the validation of physical inventory was ensured through a review of ERP system data, which reported no discrepancies.
The company also stated that it has a practice of conducting physical verification, as stated in previous audit reports, where no comments on IFC were given by the Statutory Auditors. The observation in the FY25 IFC report relates to Finished Goods (Scooters) and Raw material at stores for Ola Electric Technologies Private Limited. For the remaining inventory, physical verification was appropriately conducted, and no discrepancies were noted. Every unit manufactured by the company is electronically traceable through a unique Vehicle Identification Number (VIN), and no sales can be made without proper registration.
Ola Electric maintains that there is no element of misplacement of inventory and no financial impact on the company. The observation is solely related to the management's conduct of a physical count at year-end, which is an IFC reporting matter.
The management has implemented and will continue to implement structured measures and controls, including investments in technology and systemic changes, to strengthen inventory management and ensure robust controls for physical verification.
Ola Electric stated that it is not aware of any information that has not been announced to the exchanges that could explain any movement in the trading of the company's equity shares. The company has disclosed all material events and information as mandated under the SEBI Listing Regulations to the stock exchanges.
The information pertaining to Internal Financial Controls is already disclosed in the Consolidated Independent Auditor's Report issued by M/s BSR & Co. LLP, Statutory Auditors, which forms part of the Annual Report of the Company and was duly submitted to the Stock Exchanges on July 31, 2025.
Ola Electric affirmed that there is no material impact of the said article on the Company and that this clarification will be available on its website.
Ola Electric remains committed to compliance and will continue to promptly disclose any material information to the exchanges in accordance with regulatory requirements.
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