Page 110 - KRCL ENglish

Sr. The Key Audit matters How our audit addressed the key
No. audit matter / Auditor's Response

recognized on the date of initial
application (April 1, 2019). • Upon transition at 1st April'2019:

The application and transition to this a) Evaluated the method of transition and related
accounting standard is complex and is adjustments;
an area of focus in our audit since the
Company has lease arrangement with b) Tested completeness of the lease data by
different contractual term. reconciling the Company's operating lease
commitments to data used in computing ROU
Ind AS 116 introduces a new lease asset and the lease liabilities.
accounting model, wherein lessees
are required to recognise a right-of-use • On a stastical sample, we performed the
(ROU) asset and a lease liability arising following procedures:
from a lease on the balance sheet.
a) Assessed the key terms and conditions of each
The lease liabilities are initially lease with the underlying lease contracts; and
measured by discounting future lease b) Evaluated computation of lease liabilities and
payments during the lease term as per challenged the key estimates such as discount
the contract/ arrangement. rates and lease terms.

Adoption of the standard involves • Assessed and tested the presentation and
signicant judgements and esti-mates disclosure relating to Ind AS 116 including
including, determination of the disclosures relating to the transitions.
discount rates and the lease term.

Additionally, the standard mandates
detailed disclosures in respect of
transition.

Refer Note 2(G) and Note 44 to the
standalone nancial statements.

2. Recoverability and assessment of Our key audit procedures included and were not
Trade Receivables, Other Inter limited to the following:
Railway Financial Adjustment (IRFA) We have performed the following procedures in
Receivables relation to the recoverability of trade receivables and
Inter Railway Financial Adjustment (IRFA)
Trade Receivables of the company Receivables:
comprise mainly receivables in relation • Tested the calculations of claims on account of
to the Trafc Earning Receivable.
apportioned Trafc Earnings on sample basis.
Other Inter Railway Financial • Tested the accuracy of aging of trade receivables
Adjustment (IRFA) Receivables
and Inter Railway Financial Adjustment (IRFA) at

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