annual-report-FY2021

69 MAHINDRA & MAHINDRA LTD. INTEGRATED ANNUAL REPORT 2020-21 Your Company uses SAP ERP Systems as a business enabler and to maintain its Books of Account. The transactional controls built into the SAP ERP systems ensure appropriate segregation of duties, appropriate level of approval mechanisms and maintenance of supporting records. The Information Management Policy reinforces the control environment. The systems, Standard Operating Procedures and controls are reviewed by Management. These systems and controls are audited by Internal Audit and their ndings and recommendations are reviewed by the Audit Committee which ensures the implementation. Your Company has in place adequate internal nancial controls with reference to the Financial Statements commensurate with the size, scale and complexity of its operations. Your Company’s Internal Financial Controls were deployed through Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), that addresses material risks in your Company’s operations and nancial reporting objectives. Such controls have been assessed during the year under review taking into consideration the essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by The Institute of Chartered Accountants of India. Based on the results of such assessments carried out by the Management, no reportable material weakness or signi cant de ciencies in the design or operation of internal nancial controls was observed. Your Company recognizes that the Internal Financial Controls cannot provide absolute assurance of achieving nancial, operational and compliance reporting objectives because of its inherent limitations. Also, projections of any evaluation of the Internal Financial Controls to future periods are subject to the risk that the Internal Financial Controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate. Accordingly, regular audits and review processes ensure that such systems are reinforced on an ongoing basis. E. MANAGEMENT DISCUSSION AND ANALYSIS REPORT A detailed analysis of your Company’s performance is discussed in the Management Discussion and Analysis Report, which forms part of this Annual Report. F. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES All Related Party Transactions entered during the year were in the ordinary course of business and on arm’s length basis. During the year under review, your Company had entered into Material Related Party Transactions i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited nancial statements, with Mahindra Vehicle Manufacturers Limited, a wholly owned subsidiary of your Company. These transactions too were in the ordinary course of business of your Company and were on arm’s length basis, details of which are disclosed in Form AOC-2 as Annexure II pursuant to the requirements of section 134(3)(h) of the Companies Act, 2013, which forms part of this Annual Report. The Policy on Materiality of and Dealing with Related Party Transactions as approved by the Board is uploaded on the Company’s website and can be accessed in the Governance section at the Web-link https://www.mahindra.com/investors/reports-and-filings. G. AUDITORS Statutory Auditors and Auditors’ Report Messrs B S R & Co. LLP, Chartered Accountants (ICAI Firm Registration Number 101248W/W-100022) were appointed as the Statutory Auditors of the Company to hold of ce for a term of 5 years from the conclusion of the 71 st Annual General Meeting (AGM) held on 4 th August, 2017 until the conclusion of the 76 th AGM of the Company to be held in the year 2022. The Auditors’ Report is unmodi ed i.e. it does not contain any quali cation, reservation or adverse remark or disclaimer. Secretarial Auditor Pursuant to the provisions of section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Sachin Bhagwat, Practicing Company Secretary (Certi cate of Practice Number: 6029) to undertake the Secretarial Audit of the Company. The Company has annexed to this Board’s Report as Annexure III, a Secretarial Audit Report given by the Secretarial Auditor. The Secretarial Audit Report does not contain any quali cation, reservation or adverse remark or disclaimer.