This revised Independent Auditor's Report on Standalone Financial
Statements of IFCI Limited is issued in supersession of our earlier
Independent Auditor's Report dated 28th April, 2026, in
compliance of the Comptroller & Auditor General (C&AG) of India's
comments dated 24th June, 2026 on "Part A of Annexure-B to the
Independent Auditor's Report & on Paragraph 3 (h) (ii) of Other Legal
and Regulatory Requirements", which does not affect the true &
fair view and our opinion on the Standalone Financial Statements
as expressed earlier in any manner.
The revised report is issued with updated Part A of Annexure-B
u/s 143(5) of Companies Act 2013 in accordance with the latest
Directions issued by Comptroller & Auditor General (C&AG) and
addition of Paragraph 3 (h) (ii) of Other Legal and Regulatory
Requirement in accordance with Rule 11 of Companies (Audit &
Auditors) Amendment Rules, 2021. Further, we confirm that none
of the figures have undergone any change in the Standalone
Financial Statements of the Company as at 31st March, 2026.
Opinion
We have audited the accompanying Standalone Financial
Statements of IFCI Limited (“the Company”), which comprises the
Balance Sheet as at March 31, 2026, the Statement of Profit and
Loss (including Other Comprehensive Income), the Statement of
Cash Flows and the Statement of Changes in Equity for the year
ended on that date and Notes to the standalone Financial
Statements, including a summary of material Accounting Policies
and other explanatory information (hereinafter referred to as the
“Standalone Financial Statements”).
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 the Indian Accounting Standards
prescribed under Section 133 of the Act read with the Companies
(Indian Accounting Standards) Rules, 2015 as amended, (“Ind AS”)
and other accounting principles generally accepted in India, of the
state of affairs of the Company as at 31st March, 2026, and its profit,
total comprehensive income, its cash flows and the changes in
equity 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 (SA’s) specified under
Section 143(10) of the Companies Act, 2013 (“the Act”). Our
responsibilities under those Standards are further described in
“Auditor’s Responsibilities for the Audit of Standalone 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 (“the 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 made 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 evidences
obtained by us is sufficient and appropriate to provide a reasonable
basis for our audit opinion on the Standalone Financial Statements.
Emphasis of Matter:
1. We draw attention to Note No. 36 of the Statement, according
to which an in-principle approval has been accorded by the
Department of Financial Services (DFS), Ministry of Finance,
Government of India and duly considered and accorded by
the Board of IFCI to consider “Consolidation of IFCI Group”
which entails Merger / Amalgamation of IFCI Limited with
certain group companies at the holding company level or
subsidiary company level.
2. We draw attention to Note No. 38 of the financial results
regarding recognition of interest income of ' 93.01 crores on
stage 3 assets (except on assets which are standard under IRAC
norms) for the FY 2025-26. Since, there was no expectation of
recovery, the same has been written off as bad debts in the
same year. Hence, there is no impact on net profit or loss for
the year.
3. The company has informed us vide letter dated 01.11.2022
received from nodal ministry that case specific data for SDF
(Sugar Development Fund) Scheme may not be shared with
auditors. Accordingly, same is not reviewed by us.
4. The company has informed us that as per communication
received from nodal ministry towards PLI (Production Linked
Incentive) schemes, files and documents shall not be made
available to the auditors, hence we have not reviewed the same.
5. We draw attention to Note No. 37 where the valuation of the
investments in subsidiary companies has been considered on
the basis of financial Statements of the subsidiaries for the
period ended 31st December, 2025 instead of 31st March, 2026.
6. We draw attention to Note No. 39 where the Capital Risk
Adequacy Ratio (CRAR) stands at (-) 18.78% as on 31.03.2026,
below the minimum regulatory requirement prescribed by the
Reserve Bank of India vide Notification No. RBI/DOR/2025-
26/345 - DOR.CAP.REC.264/21-01-002/2025-26 dated 28
November 2025.
7. We draw attention to Note No. 35 where the provisioning
required under RBI Prudential (IRAC) Norms (including
standard assets provisioning) is higher than impairment
allowance under Ind AS 109 by ' 25.42 crore. However, since
the existing balance in the impairment reserve stands at
' 104.67 crores, no further Impairment Reserve has been
created, as per the requirements of RBI notification no. RBI/
DOR/2025-26/356-DOR.STR.REC.No.275/21.04.048/2025-26
dated November 28, 2025. Also, existing impairment reserve
of ' 104.67 crores has not been reversed in accordance with
the RBI notification.
Our Opinion is not modified in respect of these matters.
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.
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S.
No.
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Key Audit Matters
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How our matter was
addressed in the audit
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1.
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Impairment of Loan Assets -
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Our Audit Procedure
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Expected Credit Loss (ECL)
[Refer Note No. 53 to the
Standalone Financial
Statements read with
accounting policy No. 6(b)]
The most significant areas
where we identified greater
levels of management
judgment are:
• ECL model-impairment
loss measurement requires
use of statistical models to
estimate the Probabilities
of Default (PD), Loss Given
Default (LGD) and
Exposure at Default (EAD).
These models are key
driver to measure ECL.
• individually assessed
classification of various
Stages - the carrying value
of loans and advances to
borrowers may be
materially misstated if
individual impairments
are not appropriately
identified and estimated.
The effect of these matters is
that, as part of our risk
assessment, we determined
that the value of ECL has a high
degree of estimation
uncertainty, with a potential
range of reasonable outcomes
greater than our materiality for
the financial statements as a
whole.
in the event of any improper
application of assumptions, the
carrying value of loan assets
could be materially misstated
either individually or
collectively. In view of the
significance of the amount of
loan assets in the standalone
Financial Statements, the
impairment of loan assets
thereon has been considered as
Key Audit Matter in our audit.
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includes:
We have obtained an
understanding of the
guidelines as specified in
Ind AS 109 “Financial
Instruments”, various
regulatory updates and the
Company’s internal policy
guidelines and procedures
in respect of the expected
credit loss and adopted the
following audit procedures:
1. Evaluation and
understanding of the
key internal control
mechanisms with
respect to the loan
assets, assessment of
the loan impairment
including assessment
of relevant data quality,
and review of the real
data entered.
2. Verification/review of
documentations,
operations/
performance of Loan
asset accounts, on test
check basis of the large
and stressed loan
assets, to ascertain any
overdue, unsatisfactory
conduct or weakness in
any loan asset account.
3. Review of the reports of
the internal audit and
any other audit/
inspection
mechanisms to
ascertain the loan
assets having any
adverse indication/
comments, and review
of the control
mechanisms of the
Company to ensure the
proper classification of
such loan assets and
expected credit loss
thereof.
4. Review of the
methodology for
estimating ECL
provision on loan
assets at account level
and the basis of future
forecasted recovery for
calculation of ECL
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S.
No.
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Key Audit Matters
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How our matter was
addressed in the audit
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2.
3.
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Valuation of investments in
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5. The accuracy of critical
data elements input
including future
recovery projections,
into the system used
for computation of PD
and LGD.
6. The completeness and
accuracy of data flows
from source systems
into the ECL
calculation.
7. Independent
assessment of all Loan
assets based on IRAC
norms of RBI.
Our results:
We considered the credit
impairment charge and
provision recognized and
the related disclosures to be
acceptable & satisfactory.
Our Audit Procedure
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Subsidiaries and Associates
Due to the materiality of the
investment in the context of the
parent Company’s financial
statements and the market risk
related with recoverability of
investments, this was
considered to be the area of
focus during the course of
Company’s audits. Hence, it
was considered as a key Audit
matter in our Report.
Assessment of Information
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includes:
Review of financial
statements of all
subsidiaries and associates.
Our results:
We did not find any material
risk in recoverability of the
investments are carried in
the books at cost less
impairment, if any.
Our Audit Procedure
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Technology (IT)
The key financial accounting
and reporting processes are
highly dependent on the
automated controls over the
Company’s IT systems. There
is a risk that improper
segregation of duties or user
access management controls
(in relation to key financial
accounting and reporting
systems) may undermine our
ability to place some reliance
thereon in our audit.
We have considered this as key
audit matter as any control
lapses, validation failures,
incorrect input data and wrong
extraction of data may result in
wrong reporting of data to the
management and regulators.
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includes:
Evaluated sample of key
controls operating over the
information/input in
relation to financial
accounting and reporting
systems.
Our results:
We did not find any material
deficiencies as per our
analysis of reports
emanating from IT systems
on Financial Accounting
and reporting.
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Information other than the Standalone Financial Statements and
Auditor’s Report Thereon
The Company’s Board of Directors and Management is responsible
for the preparation of the other information. The other information
comprises the information included in the Company’s annual
report, but does not include the standalone financial statements,
consolidated financial statements and our auditor’s report thereon.
Our opinion on the standalone financial statements does not cover
the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the standalone financial statements,
our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent
with the standalone financial statements or our knowledge obtained
during the course of our audit or otherwise appears to be materially
misstated. If, based on the work we have performed, we conclude
that there is a material misstatement of this other information, we
are required to report that fact. We have nothing to report in this
regard.
Responsibilities of Management and Those Charged with
Governance for the Standalone 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 and financial performance including
other comprehensive income, cash flow and changes in equity of
the Company in accordance with the accounting principles
generally accepted in India, including Ind AS specified under
section 133 of the Companies Act, 2013.
This responsibility also includes maintenance of adequate
accounting records in accordance with the provisions of the Act
for safeguarding the assets of the Company and for preventing and
detecting frauds and other irregularities; selection and application
of appropriate accounting policies; making judgments and estimates
that are reasonable and prudent; and design, implementation and
maintenance of adequate internal financial controls, that were
operating effectively for ensuring the accuracy and completeness
of the accounting records, relevant to the preparation and
presentation of the standalone 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, management is
responsible for assessing the company’s ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless
management either intends to liquidate the entity or to cease
operations, or has no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing the
Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of 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 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 standalone financial statements.
As part of an audit in accordance with SA’s, 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 financial control relevant
to the audit in order to design audit procedures that are
appropriate in the circumstances. Under section 143(3)(i) of
the Companies Act, 2013, we are also responsible for
expressing our opinion on whether the company has adequate
internal financial controls system in place and the operating
effectiveness of such controls.
- Evaluate the appropriateness of accounting policies used and
the reasonableness of accounting estimates and related
disclosures made by management and Board of Directors.
- Conclude on the appropriateness of management’s use of the
going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt
on the Company’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to
draw attention in our auditor’s report to the related disclosures
in the standalone financial statements or, if such disclosures
are inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may
cause the Company to cease to continue as a going concern.
- Evaluate the overall presentation, structure and content of the
financial statements, including the disclosures, and whether
the standalone financial statements represent the underlying
transactions and events in a manner that achieves fair
presentation.
Materiality is the magnitude of misstatements in the standalone
financial statements that, individually or in aggregate, makes it
probable that the economic decisions of a reasonably knowledgeable
user of the standalone financial statements may be influenced. We
consider quantitative materiality and qualitative factors in (i)
planning the scope of our audit work and in evaluating the results
of our work; and (ii) to evaluate the effect of any identified
misstatements in the standalone 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. As required by the Companies (Auditor’s Report) Order, 2020
(‘the Order’) issued by the Central Government of India in
terms of sub-section (11) of section 143 of the Act, we give in
the Annexure “A” a statement on the matters specified in
paragraphs 3 and 4 of the Order.
2. As required under section 143(5) of the Companies Act, 2013,
we enclose herewith, as per Annexure “B”, our report for the
Company on the directions and sub-directions (Part A and Part
B, respectively) issued by the Comptroller & Auditor General
of India.
3. As required by Section 143(3) of the Act, based on our audit
we report that:
a) We have sought and obtained all the information and
explanations which to the best of our knowledge and belief
were necessary for the purposes of our audit;
b) In our opinion, proper books of account as required by
law have been kept by the Company so far as it appears
from our examination of those books;
c) The Balance Sheet and the Statement of Profit and Loss
including other comprehensive income, the Statement of
Cash Flows and Statement of changes in Equity dealt with
by this Report are in agreement with the books of account;
d) In our opinion, the aforesaid standalone financial
statements comply with the Ind AS specified under
Section 133 of the Act.
e) As per notification number G.S.R. 463(E) dated June 5,
2015 issued by Ministry of Corporate Affairs, Section
164(2) of the Act regarding the disqualifications of
Directors is not applicable to the Company, since it is a
Government Company
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 “C”. Our report expresses
an unmodified opinion on the adequacy and operating
effectiveness of the Company’s Internal Financial Control
over financial reporting.
g) With respect to other matters to be included in the
Auditor’s Report in accordance with the requirements of
Section 197(16) of the Act, since it is a government
company, the provision of section 197 of the Act is not
applicable to the company as per GSR 463 (E) dated June
05, 2015, issued by the Ministry of Corporate Affairs.
h) With respect to the other matters to be included in the
Auditor’s Report in accordance with Rule 11 of the
Companies (Audit and Auditors) Amendment Rules, 2021,
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 as at 31st March 2026 on its financial
position in its standalone financial statements - Refer
Note No. 33.1 to the financial statements;
ii. According to the information and explanations given
to us, the Company did not have any long term
contracts including derivative contracts for which
there are any material foreseeable losses;
iii. There has been no delay in transferring amounts,
required to be transferred, to the Investor Education
and Protection Fund by the Company.
iv. a) The Management has represented to us that, to
the best of their knowledge and belief, no funds
(which are material either individually or in the
aggregate) have been advanced or loaned or
invested (either from borrowed funds or share
premium or any other sources or kind of funds)
by the Company to or in any other person or
entity, including foreign entity
(“Intermediaries”), with the understanding,
whether recorded in writing or otherwise, that
the Intermediary shall, directly or indirectly
lend or invest in other persons or entities
identified in any manner whatsoever by or on
behalf of the Company (“Ultimate
Beneficiaries”) or provide any guarantee,
security or the like on behalf of the Ultimate
Beneficiaries.
b) The Management has represented, that, to the
best of its knowledge and belief, 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.
c) Based on the audit procedures that have been
considered reasonable and appropriate in the
circumstances, nothing has come to our notice
that has caused us to believe that the
representations under sub-clause (i) and (ii) of
Rule 11(e), as provided under (a) and (b) above,
contain any material misstatement.
v. There has been no dividend declared or paid by the
company during the year under audit.
vi. Based on our examination, which included test
checks, the Company has used accounting software
for maintaining its books of account for the financial
year ended March 31, 2026 which has a feature of
recording audit trail (edit log) facility and the same
has operated throughout the year for all relevant
transactions recorded in the software. Further, during
the course of our audit we did not come across any
instance of the audit trail being tampered with.
Further, the audit trail has been preserved by the
Company as per the statutory requirements for record
retention.
For S MANN AND COMPANY
Chartered Accountants
Firm Registration No: 000075N
CA SUBHASH CHANDER MANN
Partner
Place: New Delhi Membership No.: 080500
Date : July 20, 2026 UDIN: 26080500SHQZJK6855
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