Mobile Nav

Market

AUDITOR'S REPORT

Indian Oil Corporation Ltd.

You can view full text of the latest Auditor's Report for the company.
Market Cap. (₹) 137070.15 Cr. P/BV 1.22 Book Value (₹) 119.72
52 Week High/Low (₹) 171/116 FV/ML 10/1 P/E(X) 7.89
Bookclosure 28/08/2019 EPS (₹) 18.46 Div Yield (%) 6.35
Year End :2019-03 

INDEPENDENT AUDITORS’ REPORT

To

The Members of Indian Oil Corporation Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of Indian Oil Corporation Limited (-the Company-), which comprise the Balance Sheet as at March 31, 2019, the Statement of Profit and Loss (including other Comprehensive income), Statement of Changes in Equity and Statement of Cash Flows for the year then ended and notes to the financial statements including a summary of significant accounting policies and other explanatory information in which are incorporated the returns for the year ended on that date audited by the Branch Auditor of the Company’s one Branch, namely Research & Development (R&D) division situated at Faridabad, Haryana, India.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (the -Act-) in the manner so required and give a true and fair view in conformity with accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2019, and 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 financial statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of Act (SAs). Our responsibilities under those Standards are further described in the Auditors’ Responsibilities for the Audit of the financial statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (-ICAI-), together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules 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 we have obtained is sufficient and appropriate to provide a basis for our opinion on the standalone 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 financial statements of the current period. These matters were addressed in the context of our audit of the standalone 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 Matters

Auditors' response to Key Audit Matters

Property, Plant & Equipment and Intangible Assets

There are areas where management judgment impacts the

We assessed the controls in place over the fixed asset cycle,

carrying value of property, plant and equipment, intangible

evaluated the appropriateness of capitalization process,

assets and their respective depreciation/amortization rates.

performed tests of details on costs capitalized, the timeliness of

These include the decision to capitalize or expense costs; the

the capitalization of the assets and the de-recognition criteria for

annual asset life review; the timeliness of the capitalization of

assets retired from active use. In performing these procedures,

assets and the use of management assumptions and estimates

we reviewed the judgments made by management including the

for the determination or the measurement and recognition

nature of underlying costs capitalized; determination of realizable

criteria for assets retired from active use. Due to the materiality

value of the assets retired from active use; the appropriateness of

in the context of the balance sheet of the Company and the level

asset lives applied in the calculation of depreciation; the useful

of judgment and estimates required, we consider this to be as

lives of assets prescribed in Schedule II of the Companies Act,

area of significance.

2013 and the useful lives of certain assets as per the technical assessment of the management. We have observed that the management has regularly reviewed the aforesaid judgments and there are no material changes.

Key Audit Matters

Auditors' response to Key Audit Matters

Capital Work-in-Proeress

The Company is in the process of executing various projects like

We performed an understanding and evaluation of the system of

expansion of refineries, installation of new plants, depots, LPG

internal control over the capital work in progress, with reference to

bottling plants, terminals, pipelines, etc. Since these projects

identification and testing of key controls.

take a substantial period of time to get ready for intended use and due to their materiality in the context of the balance sheet of the Company, this is considered to be an area which had the significant effect on the overall audit strategy and allocation of

We assessed the progress of the project and the intention and ability of the management to carry forward and bring the asset to its state of intended use.

resources in planning and completing our audit

Provision for Direct Taxes

The Company has uncertain direct tax positions including matters

Our audit process involved assessment of the management’s

under dispute which involves significant judgment relating to the

underlying assumptions in estimating the tax provision (as

possible outcome of these disputes in estimation of the provision

confirmed by the Company’s tax consultants) and the possible

for income tax. Because of the judgments required, the area is a

outcome of the disputes taking into account the legal precedence,

key audit matter for our audit.

jurisprudence and other rulings in evaluating management’s position on these uncertain direct tax positions. We have observed that the provision for tax estimated as above including the deferred tax, has not resulted in material deviation from the applicable rate of tax after considering the exemptions, deductions and disallowances as per the provisions of the Income Tax Act.

Provisions and Contingent Liabilities

The Company is involved in various taxes and other disputes

Our audit procedure in response to this key Audit Matter included,

for which final outcomes cannot be easily predicted and

among others,

which could potentially result in significant liabilities. The assessment of the risks associated with the litigations is based on complex assumptions, which require the use of judgments and such judgments relates, primarily, to the assessment of

- Assessment of the process and relevant controls implemented to identify legal and tax litigations, and pending administrative proceedings.

the uncertainties connected to the prediction of the outcome

- Assessment of assumptions used in the evaluation of potential

of the proceedings and to the adequacy of the disclosures in

legal and tax risks performed by the legal and tax department

the financial statements. Because of the judgments required,

of the Company considering the legal precedence and other

the materiality of such litigations and the complexity of the

rulings in similar cases.

assessment process, the area is a key matter for our audit.

- Inquiry with the legal and tax departments regarding the status of the most significant disputes and inspection of the key relevant documentation.

- Analysis of opinion received from the experts where available.

- Review of the adequacy of the disclosures in the notes to the financial statements.

Goods and Services Tax (GST)

The country has adopted goods and services tax with effect from

Our audit process involved assessing the management’s judgments

July 1, 2017. The goods and service tax is applicable only in

on the interpretations involved taking into account the advices and

case of certain products and services of the Company while major

opinions received from indirect tax experts.

products are still covered under the old regime viz., excise duty

and value added tax. Since the Company is covered under both

the regimes, the management is required to apply judgment

in the interpretation with respect to input tax credit available

and taxability of the products and services. Since significant

judgment of the management is required, the area is a key audit

matter for our audit.

Key Audit Matters

Auditors' response to Key Audit Matters

Investments in Subsidiaries, Joint Ventures and Associates

Investments in subsidiaries, joint ventures and associates are

With reference to this key audit matter, we considered the

valued at cost adjusted for impairment losses. In line with

following:

-IndAS 36 ImDairment of assets-, in case there is an indication _ . ... ........

of possible impairment, the Company carries out an impairment

- Book value of the investments in subsidiaries, joint venture

test by comparing the recoverable amount of the investments

and associates as compared to the carrying amount.

determined according to the value in use method and their

- Market capitalization in case of listed entities in which

carrying amount. The valuation process adopted by management

investments have been made

is complex and is based on a series of assumptions, such as

the forecast cash flows, the appropriate discounting rate and the

- The prices of crude/gas being higher than the previous year’s

growth rate. These assumptions are, by nature, influenced by

level in case of upstream companies where the investments

future expectations regarding the evolution of external market.

have been made.

Since judgments of the management is required to determine

- Some of the entities are still in the construction stage and

whether there is indication of possible impairment and

have not begun commercial operations

considering the subjectivity of the estimates relating to the

Based on the information and explanations obtained as above,

determination of the cash flows and the key assumptions of the

we concluded that the Management’s judgments regarding

impairment test, the area is considered a key audit matter for

indication of impairment in certain investments during the year

our audit.

is appropriate. Where there is indication of impairment, we examined the approach taken by management to determine the value of the investments, analyzed the methods and assumptions applied by management to carry out the impairment test and the reports obtained from the experts in valuation.

The following audit procedures were adopted:

- identification and understanding of the significant controls implemented by the Company over the impairment testing

process; analysis of the reasonableness of the principal assumptions made to estimate their cash flows, and obtaining other information from management that we deemed to be significant;

- analysis of actual data of the year and previous years in comparison with the original plan, in order to assess the nature of variances and the reliability of the planning process;

- assessment of the reasonableness of the discount rate and growth rate;

- verification of the mathematical accuracy of the model used to determine the value in use of the investments.

We also examined the adequacy of the information provided by the Company about the impairment test and its consistency with the requirements of Ind AS 36.

Key Audit Matters

Auditors' response to Key Audit Matters

Receivables from Airlines Customers

The Company has trade receivables from certain airlines.

Our audit procedures included:

The increasing challenges over the economy and operating environment in the airline industry during the year have increased the risks of default on receivables from the Company’s airline

- testing the management’s judgment with respect to recoverability of the dues from airline companies;

customers if they fail to meet their contractual obligations in

- perusing the confirmations from/reconciliations with the

accordance with the contracts.

airline customers indicating that there are no material

The management has determined and assessed that these

discrepancies or disputes;

amounts are good of recovery considering the dues receivable

- perusing the financial bank guarantees received from private

from a government airline company and financial bank guarantees

airlines covering the amount due from them.

received from private airlines covering the amount due from the private airline companies.

We are also informed that the Company has invoked bank guarantee obtained from one private airline and realized the money against

Considering the materiality of the amount involved, we considered

the dues subsequent to the Balance Sheet date.

this as a key audit matter for our audit

Information Other than the Standalone Financial Statements and Auditors' 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 Financial Performance highlights, Board’s Report including Annexure to Board’s Report, Management Discussions and Analysis, Business Responsibility Report, Report on Corporate Governance, Shareholders Information and other information in Integrated Annual Report but does not include the standalone financial statements and our auditors’ report thereon.

The information to the extent available, relating to the standalone financial statements which will be included in the Management discussion and Analysis and Financial Performance Highlights have been made available to us prior to the date of this auditors’ report and we have not observed any misstatement.

The other information, to the extent not made available to us as of the date of signing this report is expected to be made available to us after the date of this auditors’ report.

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

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and identified above when it becomes available, and in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

If, based on the work we have performed on the other information that we obtained prior to the date of auditors’ report, we conclude that there is a material misstatement of this information, we are required to report that fact. We have nothing to report in this regard.

When we read the other information, if we conclude that there is material misstatement therein, we are required to communicate the matter to those charged with governance.

Responsibilities of Management and Those Charged with Governance for the Standalone 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 financial statements that give a true and fair view of the financial position, financial performance, total comprehensive income, changes in equity and cash flows of the Company in accordance with the Ind AS and the other accounting principles generally accepted in India, including Indian Accounting Standards 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 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 financial statements, the Board of Directors 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 the management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors is also responsible for overseeing the Company’s financial reporting process.

Auditors' Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone 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 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 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 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 ability of the Company to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.

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

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

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

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

Other Matters

a) We did not audit the standalone financial statements/information of one Branch included in the standalone financial statements of the Company whose financial statements/financial information reflect total assets of Rs,899.80 crore as at March 31, 2019 and total revenues of Rs,25.22 crore for the year ended on that date, as considered in the standalone financial statements. The financial statements/information of this Branch have been audited by the Branch Auditor whose report has been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of this Branch, is based solely on the report of such Branch Auditor.

b) The standalone financial statements include the Company’s proportionate share (relating to Jointly controlled operations) in assets Rs,544.39 crore, liabilities Rs,140.36 crore, income of Rs,152.52 crore and expenditure Rs,85.00 crore and elements making of the cash flow statement and related disclosures contained in the enclosed standalone financial statements and our observations thereon are based on unaudited statements from the operators to the extent available with the Company in respect of 14 blocks in India and overseas and have been certified by the management.

We have also placed reliance on technical/commercial evaluations by the management in respect of categorization of wells as exploratory, development and dry well, allocation of cost incurred on them, liability under New Exploration Licensing Policy (NELP) and nominated blocks for under-performance against agreed Minimum Work Programme.

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, 2016 (-the Order-) issued by the Central Government of India in terms of sub- section (11) of Section 143 of the Act, and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the -Annexure 1- a statement on the matters specified in the paragraphs 3 and 4 of the said Order, to the extent applicable.

2. We are enclosing our report in terms of Section 143 (5) of the Act, on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, in the -Annexure 2- on the directions issued by the Comptroller and Auditor General of India.

3. 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 have been received from the Branch not visited by us.

c) The report on the accounts of the Branch office of the Company audited under section 143(8) of the Act, by Branch Auditor has been sent to us and has been properly dealt with by us in preparing this report.

d) The Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive income),Statement of changes in Equity and the Statement of Cash Flows dealt with by this Report are in agreement with the books of account and with the returns received from the Branch not visited by us.

e) In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

f) We have been informed that the provisions of Section 164(2) of the Act in respect of disqualification of directors are not applicable to the Company, being a Government Company in terms of notification no. G.S.R.463(E) dated June 5, 2015 issued by Ministry of Corporate Affairs, 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 3-.

h) With respect to the other matters to be included in the Auditors’ Report in accordance with the requirements of section 197(16) of the Act, as amended:

We are informed that the provisions of Section 197 read with Schedule V of the Act, relating to managerial remuneration are not applicable to the Company, being a Government Company, in terms of Ministry of Corporate Affairs Notification no. G.S.R. 463 (E) dated June 5, 2015.

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

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements

- Refer Note 36 B to the standalone financial statements.

ii. The Company has made provision, as required under the applicable law or Indian accounting standards, for material foreseeable losses, if any, on long term contracts including derivative contracts - Refer Note 17 to standalone financial statements.

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

Annexure referred to in Independent Auditors' Report of even date to the members of Indian Oil Corporation Limited on the standalone financial statements for the year ended March 31, 2019

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

(b) There is a regular programme of physical verification of all fixed assets, other than LPG cylinders and pressure regulators with customers, 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 fixed assets. In our opinion and as per the information given by the Management, the discrepancies observed were not material and have been appropriately accounted for in the books.

(c) According to the information and explanations given to us and on the basis of our examination of records of the Company, the title/lease deeds of the immovable properties are held in the name of the Company except in cases given below:

Particulars

Number of cases

Gross Block/Value ('in Crore)

Net Block/Value ('in Crore)

Leasehold Land- Operating leases

15

33.75

29.53

Leasehold Land- Finance leases

9

35.59

31.51

Leasehold Land- Total

24

69.34

61.04

Freehold Land

26

158.66

158.66

Building

7

5.58

4.97

Building- operating Lease

1

20.77

20.42

(ii) In our opinion and according to the information and explanations given to us, the inventory (excluding inventory lying with third parties and material in transit) has been physically verified by the management during the year at reasonable intervals and no material discrepancies were noticed on physical verification.

(iii) In our opinion and according to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, during the year, to any companies, firms, and limited liability partnerships or other parties covered in register maintained under Section 189 of the Act.

In view of the above, reporting under clause 3 (iii)(a), 3 (iii)(b) and 3 (iii)(c) of the Order is not applicable.

(iv) In our opinion and according to the information and explanations given to us, the Company is exempted from the provisions of section 186 of the Act as it is engaged in the business of providing infrastructure facilities as provided under Schedule-VI of the Act. There were no transactions during the year to which the provisions of section 185 of the Act were applicable.

(v) In our opinion and according to the information and explanations given to us, during the year, the Company has not accepted deposits from the public in terms of the provisions of sections 73 to 76 of the Act read with the Companies (Acceptance of Deposits) Rules,2014, as amended and other relevant provisions of the Act and no deposits are outstanding at the year end except old cases under dispute aggregating to Rs,0.01 crore, where we are informed that the Company has complied with necessary directions.

(vi) We have broadly reviewed the accounts and records maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under sub-section (1) of Section 148 of the Act, read with Companies (Cost Records & Audit) Rules, 2014, as amended and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have not, however, made detailed examination of the records with a view to determine whether they are accurate and complete.

(vii) (a) Undisputed statutory dues including provident fund, employees’ state insurance, income tax, sales-tax, value added tax, service

tax, duty of custom, duty of excise, goods and service tax, cess and other statutory dues have generally been regularly deposited with the appropriate authorities and there are no undisputed dues outstanding as on March 31, 2019 for a period of more than six months from the date they became payable.

(b) The disputed statutory dues that have not been deposited on account of matters pending before appropriate authorities are annexed in -Appendix A- with this report.

(viii)ln our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institutions, banks Government or debenture holders.

(ix) According to the information and explanations given to us, the Company has applied the term loans for the purpose for which those were obtained. During the year the Company has not raised money through initial public offer or further public offer (including debt instruments). However, the Company has issued bonds for working capital requirements in the international market and as per the information and explanations given to us, the funds were applied for the purpose for which those were raised.

(x) According to the information and explanations given to us and as represented by the Management and based on our examination of the books and records of the Company and in accordance with generally accepted auditing practices in India, no material case of frauds by the Company or on the Company by its officers or employees has been noticed or reported during the year.

(xi) The provisions of Section 197 read with Schedule V of the Act, relating to managerial remuneration are not applicable to the Company, being a Government Company, in terms of Ministry of Corporate Affairs Notification no. G.S.R. 463 (E) dated June 5, 2015.

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

(xiii)ln our opinion and according to the information and explanations given by the management, all transactions during the year with the related parties were approved by the Audit Committee and are in compliance with section 177 and 188 of the Act, where applicable and the details have been disclosed in the standalone financial statements, as required by the applicable Indian 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 and therefore provisions of Section 42 of the Act are not applicable to the Company during the year.

(xv) In our opinion and according to the information and explanations given to us, the Company has not entered into any non-cash transactions specified under section 192 of the Act with directors or persons connected with him.

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

REPORTING AS PER COMPANIES (AUDITOR’S REPORT) ORDER 2016 (DISPUTED STATUTORY DUES)

Appendix - A

Sl.

No.

Name of the Statute

Nature of Dues

Forum Where Dispute is pending

Gross Amount ('Rs, Crore)

Amount Paid under Protest (Rs, Crore)

Amount (net of deposits) (Rs, Crore)

Period to which the Amount relates (Financial Years)

1

CENTRAL EXCISE

CENTRAL EXCISE

Supreme Court

67.70

12.74

54.96

1989 to 2007

ACT, 1944

High Court

251.50

0.76

250.74

1996 to 2018

Tribunal

3,308.58

29.00

3,279.58

1980 to 2018

Revisionary

14.78

0.10

14.68

2000 to 2016

Authority

Appellate

173.92

0.50

173.42

1988 to 2018

Authority

(Below

Tribunal)

Total

3,816.48

43.10

3,773.38

2

CUSTOMS ACT,

CUSTOMS DUTY

Supreme Court

11.04

2.00

9.04

1998 to 2001

1962

High Court

2.10

2.05

0.05

2004 to 2017

Tribunal

59.78

1.02

58.76

1994 to 2006

Revisionary

0.13

0.01

0.12

2010-11

Authority

Appellate

14.23

0.14

14.09

2003 to 2017

Authority

(Below

Tribunal)

Total

87.28

5.22

82.06

3

SALES TAX/VAT

SALES TAX/VAT/

Supreme Court

25.19

-

25.19

1986 to 2005

LEGISLATIONS

TURNOVER TAX

High Court

1,317.69

82.30

1,235.39

1978 to 2017

Tribunal

4,063.93

950.15

3,113.78

1984 to 2018

Revisionary

544.69

103.49

441.20

1979 to 2011

Authority

Appellate

1,758.81

192.50

1,566.31

1989 to 2018

Authority

(Below

Tribunal)

Total

7,710.31

1,328.44

6,381.87

4

INCOME TAX ACT,

INCOME TAX

Supreme Court

1961

High Court

428.31

427.69

0.62

1986 to 2006

Tribunal

2,346.17

1,984.96

361.21

2003 to 2014

Appellate

2,184.72

645.50

1,539.22

2007 to 2016

Authority

(Below

Tribunal)

Total

4,959.20

3,058.15

1,901.05

5

FINANCE ACT,

SERVICE TAX

Tribunal

26.62

0.64

25.98

1996 to 2017

1994

Appellate

17.06

0.33

16.73

2004 to 2017

Authority

(Below

Tribunal)

Total

43.68

0.97

42.71

Sl.

Name of the Statute

Nature of Dues

Forum Where

Gross Amount

Amount Paid

Amount (net

Period to

No.

Dispute is pending

(RS, Crore)

under Protest (Rs,Crore)

of deposits) ('Rs,Crore)

which the Amount relates (Financial Years)

6

STATE

ENTRY TAX

Supreme Court

5,534.02

36.59

5,497.43

1991 to 2018

LEGISLATIONS

High Court

255.17

165.68

89.49

1999 to 2018

Tribunal

38.12

25.38

12.74

2001 to 2015

Revisionary

1.44

0.20

1.24

1999 to 2013

Authority

Appellate

9.41

4.10

5.31

1998 to 2015

Authority

(Below

Tribunal)

Total

5,838.16

231.95

5,606.21

7

OTHER

OTHERS

Supreme Court

2.64

-

2.64

2010-11

CENTRAL/STATE

COMMERCIAL TAX

High Court

90.42

10.38

80.04

2001 to 2019

LEGISLATIONS

etc.

Appellate

Authority

(Below

Tribunal)

Total

GRAND TOTAL

8.78

101.84

22,556.95

1.27

11.65

4,679.48

7.51

90.19

17,877.47

1999 to 2009

Note: Dues include penalty and interest, wherever applicable.

Sl.

No.

Directions

Action Taken

Impact on financial statements

1.

Whether the company has system in the place to process all the accounting transactions through it

system? If, yes the implications of processing of accounting transaction outside IT system on the integrity of the accounts along with the financial implications, if any, may be stated.

Company has a robust ERP system (SAP) to process all the accounting transactions through IT system. Some manual intervention is necessitated for valuation of inventories; however, accounting entries for the same are also processed through ERP.

NIL

2.

Whether there is any restructuring of an existing loan or cases of wavier/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, financial impact may be stated

Company has been regular in discharging its principal and interest obligations on various loans during 2018-19. Therefore, there are no cases of restructuring of any loan or cases of waiver/write off of debts/loans/interest etc. made by any lender due to the company’s inability to repay the loan.

NIL

3.

Whether funds received/receivable for specific schemes from central/state agencies were properly accounted for/utilized as per its term and conditions? List the cases of deviation.

The Company has properly accounted for/ utilized funds received/receivable for specific schemes from central/state agencies as per its term and conditions

NIL

ANNEXURE 3 TO THE INDEPENDENT AUDITORS’ REPORT

Annexure referred to in Independent Auditors’ report of even date to the members of Indian Oil Corporation Limited on the standalone financial statements for the year ended March 31, 2019

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 Indian Oil Corporation Limited (-the Company-) as of March 31, 2019 in conjunction with our audit of the standalone 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 Act.

Auditors' 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, issued by ICAI and prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and 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 were 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 auditors’ judgments, including the assessment of the risks of material misstatement of the standalone 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 standalone financial statements for external purposes in accordance with the 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 standalone 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 standalone 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.

Opinion

In our opinion, 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, 2019 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 ICAI.

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 in so far as it relates to one Branch audited by the Branch Auditor, is based on the corresponding report of the Branch Auditor.

For S.K. MEHTA & CO . For V SANKAR AIYAR & CO.

Chartered Accountants Chartered Accountants

(Firm Regn. No. 000478N) (Firm Regn. No.l09208W)

Sd/- Sd/-

(CA. ROHIT MEHTA) (CA. M.S. BALACHANDRAN)

Partner Partner

M. No. 091382 M. No. 024282

For CK PRUSTY & ASSOCIATES For V. SINGHI & ASSOCIATES

Chartered Accountants Chartered Accountants

(Firm Regn. No. 323220E) (Firm Regn. No. 311017E)

Sd/- Sd/-

(CA. GV. JAYABAL) (CA. V. K. SINGHI)

Partner Partner

M. No. 015616 M. No. 050051

Place of Signature: New Delhi

Date: 17th May, 2019

Attention Investors :
Prevent Unauthorised transactions in your account --> Update your mobile numbers/email IDs with your stock brokers. Receive information of your transactions directly from Exchange on your mobile / email at the end of the day .......... Issued in the interest of investors
Attention Investors :
Prevent Unauthorized Transactions in your demat account --> Update your Mobile Number with your Depository Participant. Receive alerts on your Registered Mobile for all debit and other important transactions in your demat account directly from NSDL on the same day......................issued in the interest of investors.
Attention Investors :
KYC is one time exercise while dealing in securities markets - once KYC is done through a SEBI registered intermediary (broker, DP, Mutual Fund etc.), you need not undergo the same process again when you approach another intermediary.
Attention Investors :
No need to issue cheques by investors while subscribing to IPO. Just write the bank account number and sign in the application form to authorise your bank to make payment in case of allotment. No worries for refund as the money remains in investor's account.
“Investment in securities market are subject to market risks, read all the related documents carefully before investing”.