Page 246 - KRCL ENglish

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

due to availability of setoff of losses / creation of deferred tax asset on accumulated losses
unabsorbed depreciated. and unabsorbed depreciation.

Assessment of Income Tax for the We have evaluated the uncertainty of tax liability
Financial Year 2007-08 to 2014-15 are which may arise due to Income Tax assessment in
pending at various level of Appellate respect of the Financial Year 2007-08 to 2014-15 and
Authority. However, the Management compared the same with carried forward
is of the opinion that, considering the accumulated losses and unabsorbed depreciation in
outcome of past Assessment and order to ensure whether there will be additional
existing carry forward Un-absorbed impact on the nancials of the company on account
Depreciation Loss, there will not be any of Income Tax Assessments.
impact on nancials of the company.
We have drawn attention in Emphasis of Matters on
Refer Note No. 47 to the Consolidated Non-creation of Income Tax Provision and Deferred
Financial Statements for Taxes on Tax Asset considering the huge accumulated losses
Income. and which in our judgement, are fundamental to the
users' understanding of the consolidated nancial
Refer Note No. 40 to the Consolidated statements.
Financial Statements for Contingent
Liability on account of pending
assessments.

4. Inter Railway Bill Passing System Our key audit procedures included and were not
and Reconciliations limited to the following:
We have performed the following procedures in
Trade payable of the Company relation to the payment / settlement of trade
comprise mainly comprises of the payables:
claim of various Railways on account
of Loco Hire Charges, Wagon Hire Ÿ Tested the calculations of claims on account of
Charges, Fuel charges. Loco Hire charges with number of hours operated
in the month in the territory of Company.
The claims are recognised on the
following basis: Ÿ Tested the calculations of claims on account of
1) Loco Hire Charges: Per Hour basis, Wagon Hire charges with number of days
2) Wagon Hire Charges: Per Day basis, operated in the month in the territory of Company.
3) Fuel charges: On GTKm (Gross Ton
Kilometer) basis as per the Ÿ Tested the calculations of claims on account of
calculation of run mileage. fuel with GTKM basis i.e. the gross ton kilometre
run of the train belonging to Company which run
Note No. 26 of the consolidated on the track of other Railways during the month.
nancial statements for Trade
Payables

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