Page 245 - KRCL ENglish

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

Refer Note No. 13 of consolidated evaluation of management's assessment with
nancial statement related to Trade reference to the credit prole of the Other
receivables. Railways, their historical payment pattern and
latest correspondence with customers and to
Refer Note No. 17 of consolidated consider if any additional provision should be
nancial statement related to Inter made; and
Railway Financial Adjustment (IRFA)
Receivables. • Tested subsequent settlement of trade
receivables after the balance sheet date on a
Refer Note No. 46 of consolidated sample basis, if any.
nancial statement related to Balance
Conrmation and reconciliations. We found the key judgements and assumptions
used by management in the recoverability
assessment of trade receivables to be supportable
based on the available evidence.

We have drawn attention in Emphasis of Matters on
trade receivables and Other Receivable accounts in
r e s p e c t o f B a l a n c e C o n  r m a t i o n s a n d
reconciliations, which in our judgement, are
fundamental to the users' understanding of the
consolidated nancial statements.
3. Evaluation of Direct Tax Positions Our key audit procedures included and were not
The Company has huge carry forward limited to the following:
accumulated business loss and Obtained details of completed tax assessments and
unabsorbed depreciation under the demands for the year ended March 31, 2020 from
Income Tax Law. management.

Considering the past trend of income, We involved our internal experts to assess whether
management is of the view that the the carried forward accumulated losses and
future taxable prot shall not be unabsorbed depreciation are sufcient to discharge
sufcient to recoup/recover the carried the Income Tax Liability arising out of the current year
forward unabsorbed losses & prots.
unabsorbed depreciation.
We have analysed the management's underlying
In view of this, deferred tax asset assumptions in estimating the future taxable prot
related to carried forward unabsorbed considering the past trend of income.
losses & unabsorbed depreciation
have not been created by the We have analysed the management's view in
company. Further Provision for Income estimating that huge carry forward business losses
Tax is not created on taxable income and unabsorbed depreciation shall not be recovered
earned during current nancial year considering the past trend and consequently non-

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