To The Members of Delphi World Money Limited Report on the Audit of the Financial Statements Opinion
We have audited the Financial Statements of Delphi World Money Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2025, the Statement of Profit and Loss (including other comprehensive income), the 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 the significant accounting policies and other explanatory information (hereinafter referred to as "Financial Statements").
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid 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 accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2025, and profit (including other comprehensive income), changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit ofthe Financial Statements in accordance with the Standards on Auditing ("SA") specified under Section 143(10) of the Companies Act, 2013, as amended ("the Act”). Our responsibilities under those Standards are further described in the Auditor's 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 Financial Statements under the provisions of the Act and the Rules thereunder, 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 is sufficient and appropriate to provide a basis for our audit opinion on the Financial Statements.
Emphasis of Matter Paragraph
We draw attention to:
a. Note 41 of the standalone financial statements, which describes the adjudication orders issued by the Directorate of Enforcement (ED), imposing a monetary penalty of ^329.07 million on the Company and ^35.20 million on its Principal Officer for non-compliance with certain provisions of the Foreign Exchange Management Act, 1999 (FEMA). As stated in the note, the said matters pertain to the period prior to the acquisition of the Company by EbixCash World Money Limited under the Share Purchase Agreement dated December 31, 2018, and are covered under the indemnities provided by the erstwhile promoters. The Company has filed appeals before the Hon'ble Appellate Tribunal under SAFEMA and has made a pre-deposit of 15% of the penalty amount, in compliance with the Tribunal's direction. Based on legal advice and the indemnification terms, management believes that there would be no financial impact on the Company.
b. Note 56.2 of the standalone financial statements, which describes the status of Inter-Corporate Deposits ("ICDs”) aggregating to ^1,332.11 million as of March 31, 2025, extended by the Company to group entities. A substantial portion of the ICDs is outstanding from a group company with weak financial strength. The recoverability of these balances is dependent on the continued financial support from EbixCash Limited, the intermediary holding company. During the year, one of the borrower companies, Ebix Smartclass Educational Services Private Limited, fully repaid its outstanding ICD balance. Based on this development and management's assessment of the financial position of EbixCash Limited, no provision has been considered necessary in the financial statements.
Our opinion is not modified with respect to these matters.
Key Audit Matters
Key audit matters ('KAM') are those matters that, in our professional judgment, were of most significance in our audit of the Financial Statements of the current period. These matters were addressed in the context of our audit of the 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.
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Key Audit Matter
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How our audit addressed the Key Audit Matter
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1. Revenue recognition:
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The Company has revenue from the Sale and Purchase of Foreign exchange products and Inward & Outward remittances. Revenue is measured based on consideration received / receivable for services. Revenue from Foreign Exchange products, Inward & Outward Remittance and related services is a key audit matter due to the exposure to the risk of fraud due to the involvement of significant amounts of cash & cash equivalents. Additionally, the Company relies heavily on its IT system to record, process and report a high volume of revenue transactions and their integration into the back-office system.
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Principal Audit Procedures
Our audit procedures included:
Ý Assessing the accounting policies with respect to revenue recognition to be in compliance with the applicable accounting standards;
Ý Evaluating the design, testing the implementation and operating effectiveness of the Company's internal controls over recognition of revenue, along with the effectiveness of Information Technology controls built into the automated processes;
Ý Assessment of internal controls on the handling of cash, including cash verifications performed by the management, and performing cash count procedures on a sample basis;
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Key Audit Matter
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How our audit addressed the Key Audit Matter
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The audit approach relies on the effectiveness of automated controls of these applications and controls around the interface of systems.
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Ý Selecting samples of revenue transactions and testing the sample for existence and accuracy;
Ý Testing the revenue based on agreements, where applicable, and
Ý Assessing journal entries posted to revenue to identify unusual items not already covered by us.
Based on our audit procedures, we did not identify any evidence of a material misstatement in the revenue recognised for the year in the financial statements.
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2. Contingent Liabilities- Contingencies related to Regulatory, Direct and Indirect tax matters |
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The Company has a number of litigations pending, related to Regulatory, Direct and Indirect tax matters, which are under dispute with various authorities as more fully described in Note 41 to the Financial statements. This is identified as a Key Audit Matter because of the involvement of significant estimates, a degree of management's judgement for estimating the amount to be disclosed as contingent liability and the possibility of management bias.
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Principal Audit Procedures:
We have obtained an understanding of the Company's internal instructions and procedures with respect to the estimation and disclosure of contingent liabilities and have adopted the following audit procedures:
Ý Understanding and testing the designs and operating effectiveness of controls as established by management for obtaining all the relevant information for pending litigations;
Ý Holding discussions with management for any material developments and the latest status of legal matters;
Ý Reviewed the experts’ note and/ or legal opinions from independent legal counsel obtained by the management with respect to certain contentious matters;
Ý Examining management's judgements and assessments of whether provisions are required, considering the management’s assessment of those matters that are not disclosed, as the probability of material outflow is considered to be remote; and
Ý Verified the adequacy of disclosures in the financial statements in this respect.
Based on the above procedures performed, the estimation and disclosures of contingent liabilities are considered to be adequate and reasonable.
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3. Assessment of Impairment of Inter-Corporate Deposits (ICD) given to the Group companies |
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As of March 31, 2025, the Company has outstanding InterCorporate Deposits (ICDs) amounting to ^1,332.11 million extended to its group companies. A significant portion of this balance is outstanding from a group company with weak financial strength. During the year, one of the other group companies has fully repaid its outstanding ICD balance, indicating positive recovery and progress.
The recoverability of the remaining ICDs is dependent on the continued financial support from EbixCash Limited, the intermediary holding company. Considering the materiality of the outstanding balances, the financial condition of the borrower, and the reliance placed on support from EbixCash Limited, the assessment of recoverability of the ICDs has been considered a Key Audit Matter
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We performed the following key audit procedures to assess management’s estimation of the recoverable amounts of intercorporate deposits provided to Group Companies:
Ý Evaluated management's identification and assessment of impairment indicators, including the financial condition of the borrower and developments during the year.
Ý Verified the settlement of the ICD balances by group companies through review of bank statements and supporting documents.
Ý Management evaluation of the recoverability of loans granted to its Group companies;
Ý Assessed the comfort/support letter issued by EbixCash Limited in favour of the Company.
Ý Reviewed the financial strength and revenue-generating ability of EbixCash Limited to assess its capacity to provide support to the borrower group companies.
Ý Discussed with group management the basis of their assessment of recoverability.
Ý Evaluated the appropriateness and adequacy of related disclosures made in the financial statements in accordance with the applicable accounting framework.
Based on the above procedures performed, we did not identify any evidence of material misstatement on the value of ICD in the financial statements.
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Information Other than the Financial Statements and Auditor's Report Thereon
The Company's Management and Board of Directors are responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Report on Corporate Governance and Director's Report including Annexures to Director's Report, and Shareholder's Information, but does not include the Financial Statements and our auditor's report thereon. The aforesaid report is expected to be made available to us after the date of this auditor's report.
Our opinion on the 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 Financial Statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the Financial Statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.
When we read the Company's annual report, and if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance and shall take appropriate actions, if required.
Responsibilities of Management and Board of Directors for the 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 and presentation of these 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 Indian Accounting Standards (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 judgements 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, 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 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 responsible for overseeing the Company's financial reporting process.
Auditor's Responsibilities for the Audit of the 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 Annual 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 controls.
• 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 Act, we are also responsible for expressing our opinion on whether the Company has an adequate internal financial controls system with reference to the Standalone Financial statement 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 and Board of Directors.
• Conclude on the appropriateness of Management and Board of Directors' 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 appropriateness of this assumption. 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 Annual Financial Statements, including the disclosures, and whether the Annual Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the Financial Statements that, individually or in the 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 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.
Report on Other Legal and Regulatory Requirements
1. A. As required by Section 143(3) of the Act, based on our report, 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 except for the matters stated in paragraph 1(B)(f) below on reporting under rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 (as amended) ("the Rules");
(c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flow dealt with by this report are in agreement with the books of account;
(d) In our opinion, the aforesaid Financial Statements comply with the Ind AS specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;
(e) On the basis of the written representations received from the directors as on March 31, 2025, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2025, 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 with reference to the Financial Statements of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure A”. Our report
expresses an unmodified opinion on the adequacy and operating effectiveness of the Company's internal financial controls over financial reporting.
B. 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:
(a) The Company has disclosed the impact of pending litigations as at March 31, 2025, on its financial position in its Financial Statements. Refer to note 41 of the Financial Statements.
(b) The Company did not have any long-term contracts, including derivative contracts, for which there were any material foreseeable losses;
(c) There has been no delay in transferring amounts required to be transferred to the Investor Education and Protection Fund by the Company.
(d) (i) The Management has represented that, to the
best of its knowledge and belief, as disclosed in note 55(iv) to the financial statements, 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(s) or entity(ies), including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
(ii) The Management has represented, that, to the best of its knowledge and belief, as disclosed in note 55(v) to the financial statements, no funds (which are material either individually or in the aggregate) 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 by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
(iii) 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 (i) and (ii) above, contain any material misstatement.
(e) The company has neither declared nor paid any dividend during the year; therefore, reporting under rule 11 (f) is not applicable.
(f) Based on our examination, which included test checks, the Company has used accounting software
for maintaining its books of account, 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 respective software except that the feature of recording audit trail (edit log) facility at the database level to log any direct data changes for the accounting software used for maintaining the books of accounts cannot be commented upon, as the SOC Type 2 report does not specifically cover any controls related to the audit trail.
For accounting software for which the audit trail feature is enabled, the audit trail facility has been operating throughout the year for all relevant transactions recorded in the software, and we did not come across any instance of the audit trail feature being tampered with during the course of our audit.
As a proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014, the audit trail has been preserved by the company as per the statutory requirements for record retention.
C. With respect to the other matters to be included in the Auditor's Report in accordance with the requirements of Section 197(16) of the Act, as amended,
In our opinion and according to the information
and explanation given to us, the remuneration paid during the current year by the Company to its directors is in accordance with the provisions of Section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) of the Act, which are required to be commented upon by us.
2. As required by the Companies (Auditors' Report) Order, 2020 ("the Order") issued by the Central Government of India in terms of Section 143(11) of the Act, we give in “Annexure B” a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
For T R Chadha & Co LLP
Chartered Accountants
Firm Registration No.006711N/N500028
Neena Goel Partner
Membership No. 057986
Place of signature: Noida Date: April 29, 2025 UDIN: 25057986BMIKKF6561
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