We have audited the accompanying standalone financial
statements of IRB Infrastructure Developers Limited (“the
Company”), which comprise the Balance Sheet as at March
31, 2026, and the Statement of Profit and Loss (including
Other Comprehensive Income), the Statement of Changes in
Equity and the Statement of Cash Flows for the year then
ended, and notes to the standalone financial statements,
including material accounting policy information and other
explanatory information (hereinafter referred to as the
“standalone financial statements”).
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 (“the Act’) in the manner so required
and give a true and fair view in conformity with the Indian
Accounting Standards prescribed under section 133 of the
Act read with Companies (Indian Accounting Standards)
Rules, 2015, as amended (“Ind AS”) and other accounting
principles generally accepted in India, of the state of affairs
of the Company as at March 31,2026, and its profit (including
other comprehensive income), changes in equity and its cash
flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the standalone financial statements
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.
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. We have determined the matters described
below to be the key audit matters to be communicated in
our report.
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Sr
No
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Key Audit Matters
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How the Key Audit Matters was addressed in our audit
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1 (A)
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Assessment of impairment of investment in
subsidiaries (refer Note 4 to the standalone financial
statements)
The carrying amount of the investments (including sub¬
debt) in subsidiaries held at cost less impairment as at
March 31, 2026 is ' 38,164.61 million.
These investments are associated with significant risk in
respect of valuation. Changes in business environment
could also have a significant impact on the valuation.
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Impairment of investment in subsidiaries.
Our audit procedures included:
1. Evaluated the design and implementation and verified,
on a test check basis the operating effectiveness of
key controls placed around the impairment assessment
process of the recoverability of the investments made,
including the estimation of future cash flows forecasts,
the process by which they were produced and discount
rates used.
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The investments are carried at cost less any impairment
in value of such investments. These investments are
unquoted and hence it is difficult to measure the
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2.
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E xamined the key controls in place for making investments
in subsidiaries and evidenced the Board of Directors
approval obtained.
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recoverable amount. The Company performs an
annual assessment of impairment for its investments
at each cash generating unit (CGU) level, to identify any
indicators of impairment. The recoverable amount of
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3.
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A ssessed the net worth of subsidiaries on the basis of
latest available financial statements. Further:
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Sr
No
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Key Audit Matters
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How the Key Audit Matters was addressed in our audit
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the CGUs which is based on the higher of the value in
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- Compared the carrying amount of investments with
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use or fair value less costs to sell, has been derived
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the relevant subsidiaries balance sheet to identify
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from discounted forecast cash flow models which
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their net assets, being an approximation of their
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requires management to make significant estimates
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minimum recoverable amount. Where the net assets
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and assumptions related to future revenue growth,
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are in excess of their carrying amount, also assessed
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concession period, operations costs, the discount rate
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that those subsidiaries have historically been profit-
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and assessments of the status of the project and cost
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making.
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to complete balance work.
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- For the investments where the carrying amount
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exceeded the net asset value, comparing the carrying
amount of the investment with the expected value of
the business based discounted cash flow analysis.
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4.
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Tested and verified some of the key assumptions such
as future revenue growth, concession period, operations
costs, the discount rate and assessments of the status
of the project and cost to complete balance work,
which were most sensitive to the recoverable value of
the investments.
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5.
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Assessed the work performed by management as well
as management’s external valuation expert, including
the valuation methodology and the key assumptions
used. Also assessed the competence, capabilities and
objectivity of the expert used by the management in the
process of evaluating impairment models.
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6.
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Involved our internal valuation specialist, where
appropriate, to evaluate the reasonability of the
methodology, approach and assumptions used in the
valuation carried out for determining the carrying amount
of investments.
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7.
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Verified that the disclosures made in the Company’s
standalone financial statements in respect of the
investment in the subsidiaries are adequate.
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1 (B)
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Assessment of recoverability of loans/advances to
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Recoverability of loans/advances to subsidiaries and
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subsidiaries and joint ventures and fair valuation of
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joint ventures and fair valuation of other receivable from
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other receivable from joint venture (refer Note 6 and
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joint venture
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7 to the standalone financial statements)
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Our procedures included:
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The Company has extended loans to subsidiaries and
joint ventures which are assessed for impairment at
each year end. Financial assets, which include loans
to subsidiaries and joint ventures aggregated to
' 12,227.84 million at March 31, 2026. The Company
also has other receivable of ' 38,527.67 million as
March 31, 2026 from a joint venture on account of
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1.
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Evaluated the design and implementation and verified,
on a test check basis the operating effectiveness of
key internal controls placed around the impairment
assessment process of the loans/advances to subsidiaries
and joint ventures and assumptions used in fair valuation
of other receivable from joint venture.
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transfer of 9 project companies to the said joint venture,
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2.
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Examined the key controls in place for issuing new loans
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which is measured at fair value through profit and loss.
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and evidenced the Board of Directors approval obtained.
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Due to the nature of the business in the infrastructure
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3.
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Assessed Group’s identification of CGU with reference to
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projects, the Company is exposed to heightened risk
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the guidance in the applicable accounting standards.
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in respect of the impairment of the loans granted to the
aforementioned related parties and appropriateness of
assumptions used in fair valuation of other receivables
due from the said joint venture.
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4.
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Assessed the net worth of subsidiaries and joint ventures
based on latest available financial statements along with
assessing that those subsidiaries/joint ventures have
historically been profit-making and are servicing the
principal and interest schedule on timely basis.
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Sr
No
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Key Audit Matters
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How the Key Audit Matters was addressed in our audit
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There is a significant judgment and estimation
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5.
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Obtained Company’s assessment of the impairment of the
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uncertainty involved in assessing the impairment of
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loans/ advances and fair valuation of other receivables,
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above loans made to related parties, because it is
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which includes cash flow projections over the duration
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dependent on number of infrastructure projects being
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of the loans/advances and other receivables. These
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completed as per the schedule timeline and generation
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projections are based on underlying infrastructure project
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of future cash flows.
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cash flows and claims to be settled with the customers.
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There is also an estimation uncertainty involved in
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6.
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Assessed the work performed by management as well
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determining fair value of other receivables which rely
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as management’s external valuation expert, including the
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on key assumptions such as timing of collection, the
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valuation methodology and the key assumptions used.
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discount rate, and the probability of success in respect
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Further, also assessed the competence, capabilities
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of the claims.
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and objectivity of the expert used by the management
in the process of evaluating impairment models and fair
valuation, as appropriate.
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7.
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Involved our internal valuation specialist, where
appropriate, to evaluate the reasonability of the
methodology, approach and assumptions used in
the valuation.
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8.
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Obtained confirmations to evaluate the completeness
and existence of loans/advances to subsidiaries and joint
ventures and other receivables from joint venture as on
March 31, 2026.
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9.
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Verified the classification and adequacy of disclosures of
the loans/advances and other receivables.
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2
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Measurement/ recognition of construction Revenue
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Measurement of construction Revenue.
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(refer Note 20 to the standalone financial statements)
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Our audit procedures included:
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Revenue from construction contracts is recognized
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1.
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Evaluated the accounting policy for revenue recognition
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using percentage of completion method (“POC”) as
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of the Company and assessed compliance of the policy in
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per the input method prescribed under Ind AS 115 -
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terms of principles enunciated under Ind AS 115.
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Revenue from contracts with customers (“Ind AS 115”)
where performance obligations are satisfied over time.
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2.
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Evaluated the design and implementation and verified,
on a test check basis the operating effectiveness of key
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It represents 47.87% of the total revenue from
operations of the Company.
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controls around the contract price (including claims),
estimation of costs to complete and billings to customers
and management’s testing of these attributes.
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The Company has construction contracts whose
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3.
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Obtained and verified on test check basis the contract
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revenue recognition is dependent on a high level of
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and other related contractual provisions including
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judgement over the percentage of completion. It is
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contractually agreed deliverables, entitlement to variable
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based on their best estimate of the costs to complete,
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considerations, termination rights, penalties for delay, etc.
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valuation of contractual variations, claims and ability
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to understand the nature and scope of the arrangements
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to deliver the contract within the contractual time limit.
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with the customer.
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The Company’s current year revenue from construction
contracts and a significant amount of its expenses
incurred, arise from transactions with related parties.
These related parties are principally subsidiaries /joint
ventures of the Company.
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4.
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Assessed key judgements inherent in the estimation
of significant construction contract projects. It includes
comparing the stage-of completion and costs to
completion on significant projects using Lender’s Engineer
latest certificate/ Monthly Progress report.
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The Company uses an input method based on costs
incurred to measure progress of the projects. Under
this approach, the Company recognises revenue based
on the costs incurred to date relative to the estimated
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5.
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Assessed the estimated costs to complete, variations in
contract price and contract costs and sighted underlying
invoices, signed contracts/ statements of work completed
for ongoing projects.
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Sr
No
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Key Audit Matters
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How the Key Audit Matters was addressed in our audit
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total costs to complete the performance obligation.
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6.
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Obtained the Company’s process for identifying related
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Profit is not recognised until the outcome of the
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parties and recording related party transactions.
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contract is fairly certain.
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Assessed Company’s key controls in relation to the
assessment and approval of related party transactions
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Revenue is a key performance indicator of the
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and examined Company’s disclosures in respect of the
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Company. Accordingly, there can be a risk that the
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transactions. Verified on test check basis, the approvals
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Company may influence the judgements and estimates
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of the Audit Committee and Board of Directors for related
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of revenue recognition in order to achieve performance
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party transactions.
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targets to meet market expectations or incentive links
to performance for reporting period.
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7.
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Verified samples of manual journals posted to revenue to
identify unusual items.
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Revenues, total estimated contract costs and profit
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8.
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Assessed the disclosures made by the management is in
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recognition may deviate significantly from original
estimates based on new knowledge about cost
overruns and changes in scope/ term of a construction
contract and outcome of litigations.
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compliance of Ind AS -115.
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In view of above, the above matter has been identified
as a key audit matter.
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3
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Fair Valuation of Investments in InvIT & Related
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Fair Valuation of Investments in InvIT & Related Assets
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Assets (refer Note 4 and 21 to the standalone
financial statements)
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Our audit procedures included:
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1.
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Evaluated the design and implementation and verified,
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With regulatory changes relating to operations of
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on a test check basis the operating effectiveness of key
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Infrastructure Investment Trust, coupled with changes
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internal controls placed around the assessment process
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in business environment and emerging business
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of valuation of investments in InvIT & other assets.
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opportunities, the Company aligned its business model
with respect to its investments in IRB Infrastructure
Trust and related assets (‘InvIT & Related Assets’).
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2.
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Assessed the work performed by management as well
as management’s external valuation expert, including the
valuation methodology and the key assumptions used.
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Consequently, the Company assessed its eligible
investments, including interest in joint ventures meeting
the required conditions under Ind AS 28, “Investment
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Further, also assessed the competence, capabilities and
objectivity of the expert used by the management in the
process of valuations.
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in Joint ventures and Associates” read with Ind AS 27
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3.
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Involved our internal valuation specialist, where
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“Separate Financial Statements” for measurement at
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appropriate, to evaluate the reasonability of the
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fair value through profit and loss account (“FVTPL”)
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methodology, approach and assumptions used in
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during the previous year.
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the valuations.
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In measuring these investments, valuation methods are
used based on inputs that are not directly observable
from market information and certain other unobservable
inputs. The Management has also availed the services
of an independent valuation expert in this regard.
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4.
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Assessed the adequacy of disclosures made by the
Company in the standalone financial statements.
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The valuation of these assets is a focus area of our
audit as it is highly dependent on estimates (including
various assumptions and techniques used) which
contain assumptions that are not observable in
the market.
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Given the inherent subjectivity and the estimation
uncertainties involved in the valuation of the above
investments, materiality of amounts involved,
judgements involved in selecting the valuation basis,
and use of unobservable inputs, we determined this to
be a key audit matter.
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Information Other than the Standalone Financial
Statements and Auditor’s Report Thereon
The Company’s Board of Directors is responsible for the other
information. The other information comprises the information
included in the Annual Report but does not include the
standalone financial statements and our auditor’s report
thereon, which is expected to be made available to us after
that date.
Our opinion on the standalone financial statements does not
cover the other information and we will not express any form
of assurance conclusion thereon.
In connection with our audit of the standalone financial
statements, our responsibility is to read the other information
identified above when it becomes available and, in doing
so, consider whether the other information is materially
inconsistent with the standalone financial statements or our
knowledge obtained in the audit, or otherwise appears to be
materially misstated.
When we read the Annual Report, if we conclude that
there is a material misstatement therein, we are required to
communicate the matter to those charged with governance.
Responsibilities of Management and Board of
Directors for the Standalone Financial Statements
The Company’s Management and Board of Directors are
responsible for the matters stated in section 134(5) of the Act
with respect to the preparation of these standalone financial
statements that give a true and fair view of the financial
position, financial performance, changes in equity and cash
flows of the Company in accordance with the accounting
principles generally accepted in India, including the Indian
Accounting Standards specified under section 133 of the Act.
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 design, implementation and maintenance of
adequate internal financial controls, that were operating
effectively for ensuring the accuracy and completeness
of the accounting records, relevant to the preparation and
presentation of the standalone financial statement that give
a true and fair view and are free from material misstatement,
whether due to fraud or error.
In preparing the standalone financial statements, the Board of
Directors of the Company are responsible for assessing the
Company’s ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using
the going concern basis of accounting unless the Board of
Directors either intends to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.
The Board of Directors is also responsible for overseeing the
Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the
Standalone Financial Statements
Our objectives are to obtain reasonable assurance about
whether the standalone financial statements as a whole
are free from material misstatement, whether due to fraud
or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance,
but is not a guarantee that an audit conducted in accordance
with SAs will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic
decisions of users taken on the basis of these standalone
financial statements.
We give in “Annexure A” a detailed description of
Auditor’s responsibilities for Audit of the Standalone
Financial Statements.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor’s Report) Order,
2020 (“the Order”), issued by the Central Government
of India in terms of sub-section (11) of section 143 of the
Act, we give in “Annexure B” a statement on the matters
specified in paragraphs 3 and 4 of the Order, to the
extent applicable.
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
purposes of our audit of the aforesaid standalone
financial statements.
(b) In our opinion, proper books of account as required
by law relating to preparation of the aforesaid
standalone financial statements have been kept
by the Company so far as it appears from our
examination of those books.
(c) The Balance Sheet, the Statement of Profit and
Loss (including other comprehensive income), the
Statement of Changes in Equity and the Statement
of Cash Flows dealt with by this Report are in
agreement with the books of account maintained
for the purpose of preparation of the standalone
financial statements.
(d) I n our opinion, the aforesaid standalone financial
statements comply with the Ind AS specified under
Section 133 of the Act.
(e) On the basis of the written representations received
from the directors as on March 31, 2026 taken
on record by the Board of Directors, none of the
directors are disqualified as on March 31, 2026
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 with reference to standalone financial statements
of the Company and the operating effectiveness of such
controls, refer to our separate Report in “Annexure C”.
(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 standalone
financial statements - Refer Note 32 to the
standalone financial statements.
ii. The Company did not have any long-term contracts
for which there were any material foreseeable
losses except the company has made provision,
as required under the applicable law or accounting
standards, for material foreseeable losses on
derivative contracts - Refer Note 48 to the
standalone financial statements; for which there
were any material foreseeable losses.
iii. There has been no delay in transferring amounts, to
the Investor Education and Protection Fund by the
Company during the year ended March 31, 2026.
iv. a) The Management has represented that, to the
best of it’s knowledge and belief, no funds have
been advanced or loaned or invested (either
from borrowed funds or share premium or any
other sources or kind of funds) by the Company
to or in any other person(s) or entity(ies),
including foreign entities (“Intermediaries”),
with the understanding, whether recorded
in writing or otherwise, that the Intermediary
shall, directly or indirectly lend or invest in
other persons or entities identified in any
manner whatsoever by or on behalf of the
Company (“Ultimate Beneficiaries”) or provide
any guarantee, security or the like on behalf of
the Ultimate Beneficiaries.
b) The Management has represented that, to
the best of it’s knowledge and belief, no
funds have been received by the Company
from any person(s) or entity(ies), including
foreign entities (“Funding Parties”), with
the understanding, whether recorded in
writing or otherwise, that the Company shall,
directly or indirectly, lend or invest in other
persons or entities identified in any manner
whatsoever by or on behalf of the Funding
Party (“Ultimate Beneficiaries”) or provide any
guarantee, security or the like on behalf of the
Ultimate Beneficiaries.
c) Based on the audit procedures performed
that have been considered reasonable and
appropriate in the circumstances, nothing
has come to our notice that has caused us to
believe that the representations under sub¬
clause (i) and (ii) of Rule 11(e) contain any
material mis-statement.
v. The interim dividend declared and paid by the
Company during the year and until the date of this
audit report is in accordance with section 123 of the
Companies Act 2013.
The interim dividend declared by the Company
during the year is in accordance with section 123 of
the Companies Act 2013 to the extent it applies to
declaration of dividend. However, the said dividend
was not paid on the date of this audit report.
vi. Based on our examination, which included test
checks, the Company has used an accounting
software for maintaining its books of account which
has a feature of recording audit trail (edit log) facility
and the same has operated throughout the year for
all relevant transactions recorded in the software.
Further, during the course of our audit, we did not
come across any instance of audit trail feature
being tampered with. Additionally, the audit trail
has been preserved by the Company as per the
statutory requirements for record retention.
3. I n our opinion, according to information, explanations
given to us, the remuneration paid by the Company to
its directors is within the limits laid prescribed under
Section 197 read with Schedule V of the Act.
For M S K A & Associates LLP
(Formerly known as M S K A & Associates)
Chartered Accountants
ICAI Firm Registration No. 105047W/W101187
Nitin Tiwari
Partner
Place: Mumbai Membership No.: 118894
Date: May 20, 2026 UDIN: 26118894ZXAUCP4948
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