MAHINDRA & MAHINDRA LTD. Standalone Accounts 273 Report on the Audit of the Standalone Financial Statements Opinion We have audited the standalone financial statements of Mahindra & Mahindra Limited (the “Company”) which comprise the standalone balance sheet as at 31 March 2025, and the standalone statement of profit and loss (including other comprehensive income), standalone statement of changes in equity and standalone statement of cash flows for the year then ended, and notes to the standalone financial statements, including material accounting policies and other explanatory information. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (“Act”) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2025, and its profit and other comprehensive income, changes in equity and its cash flows for the year ended on that date. Basis for Opinion We conducted our audit in accordance with the Standards on Auditing (SAs) specified under Section 143(10) of the Act. Our responsibilities under those SAs are further described in the Auditor’s Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on the standalone financial statements. Key Audit Matters Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Impairment assessment of certain long-term investments in subsidiaries, joint ventures and associates See Note 2(d)(iv) to standalone financial statements The key audit matter How the matter was addressed in our audit The Company has long-term investments in subsidiaries, joint ventures and associates (collectively “the investments”) aggregating Rs. 22,378.60 crores as at 31 March 2025. The Company records the investments at cost less any provision for impairment loss. Changes in business environment, including market or economic environment, geopolitical situations and general inflationary trends could have a significant impact on the valuation of certain investments. Investments where an indication based on these factors exists, are tested for impairment at the end of the reporting period. The Company determines the recoverable value of such investments and compares it to its carrying amount to determine impairment loss. The recoverable value is determined basis following key assumptions: • projected future cash inflows; • expected growth rate; discount rate; terminal growth rate; • comparison of price and market multiples The recoverable amount, which is the higher of the market value or Value In Use (VIU) or fair value less costs of disposal of such investments (FVLCD), is estimated and the impairment loss, if any, is recognised in the statement of profit and loss and carrying amount of investments is reduced to its recoverable amount. The impairment test is considered to be a key audit matter considering the significant judgements required in determining the key assumptions. Our audit procedures included: • Assessed the design, implementation and operating effectiveness of key controls in respect of the Company’s impairment assessment process, including the approval of forecasts and valuation models; • Obtained an understanding of various external factors impacting the recoverable value of the respective investment as at the end of the reporting period; • Involved valuation specialists, as applicable, to evaluate the appropriateness of the valuation models used, assumptions such as the discount rates used in VIU calculations and comparable companies considered in the FVLCD model; • Tested the key VIU assumptions used in estimating future cash flows such as revenue, costs and growth rates by comparing these inputs with externally derived data, past performances, consistency with the Board approved investment plans and knowledge of the industry; • Evaluated past performance where relevant, and assessed historical accuracy of the forecast produced by management; and • Assessed the adequacy of disclosures on key judgements, assumptions and quantitative data with respect to impairment losses. Independent Auditor’s Report to the Members of Mahindra & Mahindra Limited
RkJQdWJsaXNoZXIy NTE5NzY=