We have audited the accompanying Standalone Financial Statements of Indian Renewable Energy Development
Agency Limited ("the Company"),which comprise the Standalone Balance Sheet as at March 31, 2025, and the
Standalone Statement of Profit and Loss (including Other Comprehensive income), Standalone Statement of
Changes in Equity and Standalone Statement of Cash Flows for the year then ended, and Notes to the Standalone
Financial Statements, including a summary of material accounting policies and Other Explanatory information
prepared in accordance with the requirement of the Companies Act 2013 ( as amended) ( "the Act")' (hereinafter
referred to as "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 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 the accounting
principles generally accepted in India, of the state of affairs of the Company as at March 31, 2025, and profit
including 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
specified under section 143(10) of the Act ("SAs"). Our responsibilities under those Standards are further
described in the 'Auditor's Responsibilities for the Audit of the 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 ("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 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
Standalone Financial Statements.
Emphasis of Matter
We draw your attention to the following matters:
1. As described in Note 38 (40) to the Standalone Financial Statements, the company has classified certain
Loans given aggregating to ' 1,202.21 crore required to be classified as stage III /Non-Performing Assets
(NPA) as stage II / Standard in terms of interim order of Hon'ble High Court of Andhra Pradesh and Hon'ble
High Court of Delhi. The statutory disclosures have been made accordingly. However, as a matter of
prudence, interest income on such accounts becoming NPA in terms of prudential norms of RBI has been
recognized on collection basis and allowance for impairment loss has been made in accounts accordingly.
2. As described in Note 48 (B)(a) to the Standalone Financial Statements, As of 31 March 2024,the reported CRAR
of the Company was 20.11% .This calculation was based on a 50% risk weight assigned to commissioned
renewable energy infrastructure project assets financed by the Company that had reached their commercial
operations date (COD) and had been operational for over a year. However as per 31 March 2025, the company
has applied a 100% risk weight to these assets. Accordingly, CRAR of corresponding period as at 31 March
2024 has been restated to 15.51%.
Our opinion is not modified in respect of the above 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 for 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 considered the matters described below to be the Key Audit
Matters for incorporation in our Report.
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Sr. No.
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Key Audit Matters
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Auditor’s Response
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1.
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Impairment of Loan Assets - Expected Credit
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Our Audit procedures based on which we arrived
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loss
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at the conclusion regarding reasonableness of
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Financing is principal business of the Company
and disclosure of Loan assets at fair value
after considering the provision for loss due to
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the disclosures and accounting for Impairment
of Loan Assets -Expected Credit loss includes
the following:
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impairment is most significant.
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We have obtained an understanding of the
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The Company follows a Board approved
methodology wherein assessment for
allowance is carried out by an external agency
for impairment based on certain criterion /
framework classifying the assets into various
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guidelines as specified in Ind AS 109 "Financial
Instruments", various regulatory updates,
guidance of ICAI and internal instructions and
procedures of the Company in respect of the ECL
and adopted the following audit procedures:
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stages depending upon credit risk and level of
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Evaluation and testing of the key internal control
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evidence of impairment.
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mechanisms with respect to the loan assets
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The measurement of an expected credit loss
allowance (ECL) for financial assets measured
at amortized cost requires the use of complex
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monitoring, assessment of the loan impairment
including testing of relevant data quality, and
review of the real data entered.
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models and significant assumptions about future
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Recoveries in the loan assets are verified to
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economic conditions and credit behaviour (e.g.,
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ascertain level of stress thereon and impact on
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likelihood of customers defaulting and resulting
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impairment allowance in Standalone Financial
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losses) to estimate the Probabilities of Default
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Statements.
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(PD), Loss Given Default (LGD) and Exposure at
Default (EAD). These models and assumptions
are key driver to measure Impairment loss.
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Verification / review of the documentation,
operations / performance, valuation of available
securities and monitoring of the loan assets,
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The Company makes significant judgments
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especially large and stressed loan assets, to
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while assessing ECL and the assumptions
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ascertain any overdue, unsatisfactory conduct or
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underlying the ECL are monitored and reviewed
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weakness in any loan asset account.
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on periodically basis.
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The company avails services of third party for
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The proper application of such assumptions
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evaluation of ECL Components. The calculations
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is material for statement of the Loan Assets.
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in the study for impairment allowance carried
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In view of the materiality of the amount of loan
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out by third party are relied upon by us and test
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assets in the Standalone Financial Statements,
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checks are carried out for the same. The data
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the loss due to impairment of loan assets has
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shared with the third party is verified by us for
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been considered as Key Audit Matter in our audit.
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correctness of material components being
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Refer Note no. 38 (19) (A) (ii) (a) to the
Standalone Financial Statements read with
material accounting policy No.3(xx)- 'Financial
Instruments')
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submitted. Our audit procedure in the same are
limited in view of not sharing software access
used for study of such data considering the
confidentiality by such third party.
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We also compared ECL with the provisioning
as required by the applicable directions of the
Reserve Bank of India and ensured adequacy of
impairment allowance accordingly.
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Sr. No.
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Key Audit Matters
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Auditor’s Response
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2
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Fair valuation of Derivative Financial
Instruments
To mitigate the Company's exposure to foreign
currency risk and interest rate, non-Rupee cash
flows are monitored and derivative contracts are
entered for hedging purpose. The derivatives are
measured at fair value as per Ind AS 109.
To qualify for hedge accounting, the hedging
relationship must meet certain specified
requirements as per Ind AS. Hedge accounting
results in significant impact on Standalone
Financial Statements together with complexity
of its accounting/assumptions and numerous
parameters therein for establishing hedge
relationship. Gain/Loss on these derivatives
is recognised in other comprehensive income
or profit and loss as provided by Ind AS. The
magnitude of such transactions is significant as
per the operations of the company.
In view of facts of the matter we have identified it
as a key audit matter.
(Refer Note No. 38 (29) to the Standalone Financial
Statement read with material accounting policy
No. 3(xx).
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Our Audit procedures based on which we arrived
at conclusion regarding reasonableness of
the disclosures and accounting for derivatives
include the following:
-Verification of fair value of derivative in
terms of Ind AS 109, testing the accuracy and
completeness of derivative transactions.
-Evaluation of management's key internal
controls over classification, valuation, and
valuation models of derivative instruments.
-Obtaining details of various financial derivatives
contracts as outstanding/pending for settlement
as on 31st March, 2025.
-Discussing and understanding management's
perception and studying policy of the company
for risk management.
-Verification of Mark To Market valuation report
for outstanding derivatives deal as on 31st March
2025 obtained by the company from external
valuer.
-Verification of underlying assumptions in
estimating the fair valuation arrived at for those
financial derivative contracts.
-Appropriateness of the valuation methodologies
applied and testing the same on sample basis for
the derivative instruments.
Additionally, we verified the accounting of gain/
loss on derivatives in the other comprehensive
income or Profit & Loss Account.
Reviewed the appropriateness and adequacy of
disclosures by the management as required in
terms of Ind AS 109.
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3
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Liability for Taxation
The company has material uncertain tax demands
in respect of matters under dispute which
involves significant judgement to determine the
possible outcome of these disputes.
Service Tax and Goods & Service Tax (GST)
Authorities have raised certain issues and raised
demands for several past periods, which are
being contested by company at various forums.
Income Tax cases for FY 2013-14 and FY 2019-20
are pending before the CIT (Appeals). Appropriate
provision and disclosure of consequential
liabilities is material to the presentation of
Standalone Financial Statements.
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Our Audit procedures based on which we
arrived at conclusion regarding reasonableness
of the disclosures and accounting for Liability
for Taxation include the following:
Our audit procedure includes review of various
orders passed by Assessing Officer on the
subject matter in dispute with Department of
Income Tax. We undertook procedure to evaluate
management position on these uncertain tax
positions.
For other tax matters, the facts and the legal
pronouncements were analyzed and reviewed.
We reviewed the appropriateness and adequacy
of disclosures by the management as required
in terms of Ind AS 37 "Provisions, Contingent
Liabilities and Contingent Assets".
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Sr. No.
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Key Audit Matters
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Auditor’s Response
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Possible outcome of these demands may be
substantial.
In view of this we have identified it as a key audit
matter.
Refer note 38 (16) (a) of the Standalone Financial
Statements.
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Information Other than the Ind AS Standalone Financial Statements and Auditor’s Report thereon
The Company's Board of Directors is responsible for the other information. The other information comprises the
information included in the Board's Report including Annexures to Directors' Report, Management Discussion
and Analysis Report, but does not include the Standalone Financial Statements and our auditors' report thereon.
The other information as stated above 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 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 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 during the course
of our audit or otherwise appears to be materially misstated. When we read the other information as stated above
and if we conclude that there is a material misstatement therein, we are required to communicate the matter to
those charged with governance and describe necessary actions required as per applicable laws and regulations.
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 state of affairs
(financial position), Profit or Loss (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 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 of the company 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 Board of Directors 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.
Auditor’s 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 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 Standard on Auditing 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
scepticism 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 Act, we are also responsible for
expressing our opinion on whether the Company has adequate internal financial controls system with
reference to Standalone Financial Statements 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 audit 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 audit 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.
Materiality is the magnitude of misstatements in the Standalone Financial Statements that, individually or in
aggregate, make it probable that 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 of the Company regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal financial 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 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.
Other Matters
i. As per past practice, in respect of loan assets, the Company has provided Expected Credit Loss (ECL) as
required under Ind AS 109 based on the ECL report submitted by an independent expert appointed by the
Company, which inter alia includes assumptions based on technical parameters / certain aspects.
ii. The audit of financial statements for the year ended March 31, 2024 was conducted by the predecessor
statutory auditor of company, who had expressed unqualified opinion on those financial statements vide
their report dated April 19, 2024.
Reports 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 Companies Act, 2013, we give in the "Annexure-A”,
a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable and in
terms of sub-section (5) of section 143 of the Act, we give in the "Annexure-B” information in respect of the
directions issued by Comptroller and Auditor-General of India in respect of the company .
2. As required by section 143(3) of the act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge
and belief were necessary for the 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 purposes of our
audit have been received from branches not visited by us;
c) The Standalone Balance sheet, the Standalone Statement of Profit & Loss including Other
Comprehensive Income, Standalone Statement of Changes in Equity and the standalone statement of
Cash Flows 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 accounting standards
specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;
e) In terms of Notification no. G.S.R. 463 (E) dated 05th June 2015 issued by the Ministry of Corporate
Affairs, provisions of Section 164(2) of the Act regarding disqualifications of the Directors, are not
applicable as it is a Government Company;
f) As per notification number G.S.R. 463 (E) dated 5th June, 2015 issued by Ministry of Corporate Affairs,
section 197 of the Act as regards the managerial remuneration is not applicable to the Company, since
it is a Government Company.
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-C”.
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) Rules, 2014 ( 'Audit Rules') , 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 38 (16) to Standalone Financial Statements.
ii. The Company has made due provision as required under the applicable law or Indian Accounting
Standards, for material foreseeable losses, if any, on long term contracts including derivatives
contracts: - Refer note 38(19)(C) (II) (c) to the Standalone Financial Statements.
iii. There were no amounts which were required to be transferred to the Investor Education and
Protection Fund by the Company.
iv. (a) The management has represented (Refer note 38(27)) that to the best of its knowledge and
belief , 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
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 (( Refer note 38(27)) that to the best of its knowledge and
belief , no funds 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, 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; and
(c) Based on audit procedure performed 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 (a) and (b) contain any material misstatement.
v. No dividend has been declared or paid during the year by the company.
vi. Based on our examination which included test checks, the company has used an accounting
software for maintaining its books of account for the financial year ended 31st March 2025, 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 audit trail feature being tampered with and
the management has represented that the audit trail feature cannot be disabled. Company has
preserved the Audit trail as per the statutory requirements for records retention.
For Shiv & Associates
Chartered Accountants
Firm's Registration Number: 009989N
Sd/-
CA Shiv Prakash Chaturvedi
Partner
Membership No. 085084
UDIN: 25085084BMMBWD6474
Date: 15.04.2025
Place: New Delhi
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