REVISED INDEPENDENT AUDITORS' REPORT

TO THE SHAREHOLDERS OF BHARAT IMMUNOLOGICALS & BIOLOGICALS CORPORATION LIMITED.

Report on the Ind AS Financial Statements

This revised report is in supersession of our earlier report dated 31/05/2018 on the basis of preliminary review of financial statements by Comptroller & Auditor General (C&AG) of India. We confirm that these changes do not affect true & fair view and also none of the figures have undergone any change in the financial Statements of the Company as at 31^st March 2018.

We have audited the accompanying Ind AS financial statements of BHARAT IMMUNOLOGICALS & BIOLOGICALS CORPORATION LIMITED (“the Company”), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.(herein after referred to as “Ind As Financial Statement”).

Management Responsibility for the Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act., read with Rule 7 of The Companies (Indian Accounting Standards) Rules, 2015, as amended and other accounting principles generally accepted in India.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial control that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these Ind AS financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under and Order issued under section 143(11) of the Act.

We conducted our audit of the Ind AS financial statements in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India, as specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the Ind AS financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Ind AS financial statements.

Basis of Qualification

a) Non furnishing of information in respect of payment of remuneration to Chief Financial Officer and Company Secretary of the company under note no 31(k) for disclosures made in compliance to Ind AS-24 ‘Related Party Disclosure’.

b) Sundry debtors amounting to Rs 645.42 Lacs as appearing in Note No 31(h). of the Financial Statement represent the late delivery charges deducted by the Ministry Of Health and family welfare, which raises doubt about its recoverability, and require suitable provision as per Ind AS-37" Provisions, Contingent Liabilities and Contingent Assets" issued by the Institute Of Chartered Accountants Of India .

c) There are irregularities in the implementation of the MACPS (Modified Assured Career Progression Scheme) which is not as per the recommendation of the sixth Central Pay commission which has resulted in excess payment to the some selected employees during the financial year 2010-11 to 2016-17 to the extent of Rs 30.69 lakhs and Rs 5.03 lakhs for the financial year 2017-18.

Our Audit Report is qualified in respect of above matter.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the matters described in the Basis for Qualified Opinion wherein basis of qualification a)does not have any financial impact and impact of basis of qualification b) is presently unascertainable and had the company provided remuneration as per sixth central pay commission the profit before tax would be more by Rs. 5.03 lakhs and other equity would be more by 35.72 lakhs and other current assts would be more by 35.72 lakhs, the Ind AS financial statements give the information required by the 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 March 31, 2018, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date

Emphasis On Matter

1. Non-furnishing of information in respect of dues of Micro, Small and Medium Enterprises as per Note No.31(g)

2. Attention is drawn to note no 31(f) in earlier years company has received various grants from Government of India. These grants should be utilized accordingly with the line of its objects. Further attention is also invited to Note No 31(f) "IV and V regarding Grant received in 20102011 and 2012-2013 but the significant amount lying unspent as on 31^st March, 2018. Management stated that the above grant related to up gradation of OPV projects due to change in technology, the matter has been referred to Ministry for purchase of new Machinery and direction from the Ministry awaited.

3. Regarding non attendance of Sh.Venkata Subba Rao Kanury, director of the company to the entire Board meeting during the financial year which require immediate vacation of the director as per the provision of section 167(1)(b).

4. An amount of Rs 21.936 Lakh appearing in Capital work in progress. The work has been suspended and has been in abeyance since long time. The company has referred the matter to ministry to sale of the uncompleted structure or to permit to use this structure for other purposes after completing the work.

5. The company has not provided pay and allowances of the employees as per recommendation of 7^th Central pay commission since same is not implemented in the absence of profit as the office memorandum W-02/0058/2016-DPE(WC)-GL-XV/17 dated 17^th August, 2017 issued by Department of public Enterprises is applicable for profit making Central Public Sector Enterprises.

Our report is not qualified in respect to the above matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central Government in terms of section 143(11) of the Companies Act, 2013, we give in the “Annexure A” statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by section 143(3) of the Act, we report that:

a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b. In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books

c. The Balance Sheet, Statement of Profit and Loss including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

d. In our opinion, except (a) and (b) of the basis of qualification, the aforesaid Ind AS financial statements comply with the Indian Accounting Standards specified under section 133 of the Act, read Companies (Indian Accounting Standards) Rules, 2015, as amended;

e. On the basis of written representations received from the directors as on March 31,2018 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2018 from being appointed as a director in terms of section 164(2) of the Act.

f. with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in “Annexure B”

g. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its Ind AS financial statements - Refer Note 31(e) to the Ind AS financial statements

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

3. As required by the direction under section 143(5) of the Act, we report that :

“ANNEXURE A” TO THE AUDITORS’ REPORT”

(Referred to in paragraph (1) of our Report on other Legal and Regulatory requirements section of our report of even date to the shareholder of BHARAT IMMUNOLOGICALS & BIOLOGICALS CORPORATION LIMITED)

1. a). The company has maintained proper records to show full particulars including quantitative details and situation of its fixed assets.

b. The fixed assets of the company have been physically verified during the year by the management at reasonable intervals and no material discrepancies between the book records and the physical inventory have been noticed on such verification.

c. According to the information and explanation given to us it being a public sector undertaking only allotment letter is issued in respective of the immovable properties which is held in the name of the company.

2. a. The management has conducted the physical verification of inventory at reasonable intervals.

b. The discrepancies noticed on physical verification of the inventory as compared to books records are not material and have been properly dealt with in the Books of Accounts

3. According to information made available to us , the company has not granted any loan , secured or unsecured to companies, firms, LLPs or other parties covered in the register maintained under section 189 of the Act accordingly Para 3(iii)(a) & (c) of the Order are not applicable to the company.

4. On the basis of information and explanation given to us, the company has not entered into transactions mentioned in section 185 and 186 of the Act, accordingly paragraph 3(iv) of the Order is not applicable.

5. On the basis of information and explanation given to us and our scrutiny of company records , in our opinion, the company has not accepted any public deposits.

6. We have broadly reviewed the books of accounts maintained by the company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 148(1) of the Companies Act,2013 and are of the opinion that prima facie, the prescribed accounts have been made and maintained.

7. (a) According to the information and explanation given to us the company is generally regular in depositing with appropriate authorities the undisputed statutory dues including provident fund, income-tax, sales-tax, service tax, custom duty, excise duty, value added tax, cess and any other statutory dues applicable to it. Further, there was no arrears of undisputed statutory dues outstanding as at 31^st March, 2018 for a period of more than six month from the date they became payable.

(b) According to the information and explanations given to us, there are no tax dues of income-tax, sales-tax, service tax, custom duty, excise duty, value added tax which have not been deposited on account of any dispute, except the following:-

8. Based on our examination and according to the information and explanation given, there are no dues of term loan to the banks financial institutions or due to debenture holders.

9. The company did not raise money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, paragraph 3(ix) of the Order is not applicable.

10. To the best of our knowledge and belief and according to the information and explanation given to us, no fraud on or by the company has been noticed or reported during the course of our audit for the year ended 31 March, 2018.

11. According to the information and explanations give to us the company has not paid/provided any Managerial remuneration to any of the Directors of the company. Accordingly, paragraph 3(xi) of the Order is not applicable.

12. In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.

13. According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

14. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

15. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

16. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.

Annexure - B to the Auditors’ Report Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

We have audited the internal financial controls over financial reporting of BHARAT IMMUNOLOGICALS & BIOLOGICALS CORPORATION LIMITED (“the Company”) as at 31 March,2018 in conjunction with our audit of the Ind As financial statements of the Company for the period ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI’). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.

Meaning of the Internal Financial Controls over the Financial Reporting

A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March,2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For B.K.KAPUR AND CO.

Chartered Accountants

Firm Registration No. 000852C

(M.S.KAPUR) F. C A.

(Partner)

PLACE: GHAZIABAD Membership No: 074615

Date: 17.07.2018