Independent auditor's report to the members of Mindtree limited

Report on the Financial Statements

We have audited the accompanying financial statements of Mindtree Limited ('the Company'), which comprise the balance sheet as at March 31, 2013, the statement of profit and loss and the cash flow statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (“the Act”). This responsibility includes the design, implementation and maintenance of internal control 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.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the 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 accounting principles generally accepted in India:

a) in the case of the balance sheet, of the state of affairs of the Company as at March 31, 2013;

b) in the case of the statement of profit and loss, of the profit for the year ended on that date; and

c) in the case of the cash flow statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

  1. As required by the Companies (Auditor's Report) Order, 2003 (“the Order”), as amended, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.
  2. As required by section 227(3) of the Act, we report that:
    • we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;
    • in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;
    • the Balance Sheet, Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;
    • in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Act; and
    • on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Act.

For B S R & Co.
Chartered Accountants
Firm registration No. 101248W

Supreet Sachdev
Partner
Membership No. 205385

Bangalore
April 22, 2013

Annexure to the Auditor's Report

The Annexure referred to in the Auditor's Report to the members of Mindtree Limited ('the Company') for the year ended March 31, 2013.

We report as follows:

  1. The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets
    • The Company has a regular programme of physical verification of its fixed assets by which fixed assets are verified in a phased manner over a period of three years. In our opinion, the periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. In accordance with this programme, certain fixed assets were verified during the year and no material discrepancies were observed on such verification.
    • Fixed assets disposed off during the year were not substantial and therefore do not affect the going concern assumption.
  2. The Company is a service company, primarily rendering software development services. Accordingly, it does not hold any physical inventories. Thus, paragraph 4(ii) of the Order is not applicable.
  3. The Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.
  4. In our opinion and according to the information and explanations given to us, and having regard to the explanation that purchase of certain items of fixed assets are for the Company's specialized requirement and suitable alternative sources are not available to obtain comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for purchase of fixed assets and sale of services. The activities of the Company do not involve purchase of inventory and the sale of goods. We have not observed any major weakness in the internal control system during the course of the audit.
  5. In our opinion, and according to the information and explanations given to us, there are no contracts and arrangements the particulars of which need to be entered into the register maintained under section 301 of the Companies Act, 1956.
  6. The Company has not accepted any deposits from the public.
  7. In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.
  8. The Central Government of India has not prescribed the maintenance of cost records under section 209(1) (d) of the Companies Act, 1956 for any of the services rendered by the Company.
  9. According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees State Insurance, Income tax, Sales tax, Service tax, Customs duty, and other material statutory dues have been generally regularly deposited during the year
    by the Company with the appropriate authorities. As explained to us, the Company did not have any dues on account of Wealth tax, Excise duty and Investor Education and Protection Fund.
    • According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees State Insurance, Income tax, Sales tax, Service tax, Customs duty, Cess and other material statutory dues were in arrears as at March 31, 2013 for a period of more than six months from the date they became payable.
    • According to the information and explanations given to us, there are no dues of Customs duty and Cess which have not been deposited with the appropriate authorities on account of any dispute. The Company, however, disputes the following Income tax, Service tax and Sales tax dues:

*The above amounts are net of amount paid under protest.

**The appeal filed with the High Court has been dismissed and currently pending with the Assessing Officer as per ITAT order dated 12 July 2007.

***Stay granted by Customs, Excise and Service Tax Appellate Tribunal, Bangalore vide original order dated 6 January 2012 and further order received dated 21 February 2013.

****Stay granted by Customs, Excise and Service Tax Appellate Tribunal, Bangalore vide order dated 27 September 2012.

*****Appeal pending to be filed with the Dispute Resolution Panel.

10.The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

11.In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers. The Company did not have any outstanding dues to any financial institution or debenture holders during the year.

12.The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13.In our opinion and according to the information and explanations given to us, the Company is not a chit fund/ nidhi/ mutual benefit fund/ society.

14.According to the information and explanations given to us, the Company is not deapng or trading in shares, securities, debentures and other investments.

15.According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

16.The Company did not have any term loans outstanding during the year.

17.According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that the funds raised on short-term basis have not been used for long-term investment.

18.The Company has not made any preferential allotment of shares to companies/ firms/ parties covered in the register maintained under Section 301 of the Companies Act, 1956.

19.The Company did not have any outstanding debentures during the year.

20. The Company has not raised any money by pubpc issues during the year.

21.According to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the course of our audit.

For B S R & Co.
Chartered Accountants
Firm registration No.
101248W

Supreet Sachdev
Partner
Membership No. 205385

Bangalore
April 22, 2013

Balance Sheet

balance sheet

Significant accounting policies and notes to the accounts 2&3

The notes referred to above form an integral part of the financial statements

As per our report of even date attached

For Mindtree Limited

 

For B S R & Co.
Chartered Accountants
Firm registration No.
101248W
Subroto Bagchi
Chairman
N. Krishnakumar
CEO & Managing Director
Supreet Sachdev
Partner
Membership No. 205385
Place: Bangalore
Date : April 22, 2013
Rostow Ravanan
Chief Financial Officer
Place: Bangalore
Date : April 22, 2013
Rajesh Srichand Narang
Company Secretary

Statement of profit and loss

Significant accounting policies and notes to the accounts 2&3

The notes referred to above form an integral part of the financial statements

As per our report of even date attached

For Mindtree Limited

For B S R & Co.
Chartered Accountants
Firm registration No.
101248W
Subroto Bagchi
Chairman
N. Krishnakumar
CEO & Managing Director
Supreet Sachdev
Partner
Membership No. 205385
Place: Bangalore
Date : April 22, 2013
Rostow Ravanan
Chief Financial Officer
Place: Bangalore
Date : April 22, 2013
Rajesh Srichand Narang
Company Secretary

Cash flow statement

Cash flow statement

The notes referred to above form an integral part of the financial statements

As per our report of even date attached

For Mindtree Limited

For B S R & Co.
Chartered Accountants
Firm registration No. 101248W
Subroto Bagchi
Chairman
N. Krishnakumar
CEO & Managing Director
Supreet Sachdev
Partner
Membership No. 205385
Place: Bangalore
Date : April 22, 2013
Rostow Ravanan
Chief Financial Officer
Place: Bangalore
Date : April 22, 2013
Rajesh Srichand Narang
Company Secretary