Mar 31, 2023
ICICI Prudential Life Insurance Company Limited
REPORT ON THE AUDIT OF THE STANDALONEFINANCIAL STATEMENTSOPINION
We have audited the accompanying standalone financial statements of ICICI Prudential Life Insurance Company Limited (the âCompanyâ), which comprise the Balance Sheet as at 31 March 2023, the Revenue Account (also called the âPolicyholders'' Accountâ or the âTechnical Accountâ), the Profit and Loss Account (also called the âShareholders'' Accountâ or the âNon-Technical Accountâ) and the Receipts and Payments Account for the year then ended, and notes to standalone financial statements, including a summary of significant 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 in accordance with the Insurance Act, 1938 (the âInsurance Actâ), as amended from time to time, including amendment brought by Insurance Laws (Amendment), Act 2015 the Insurance Regulatory and Development Authority Act, 1999 (the âIRDA Actâ), the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditors'' Report of Insurance Companies) Regulations, 2002 (the âIRDA Financial Statements Regulationsâ), orders/ directions/ circulars issued by the Insurance Regulatory and Development Authority of India (the âIRDAIâ) and the Companies Act, 2013 (the âActâ), to the extent applicable, 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 2023, its net surplus, its profit and its receipts and payments for the year ended on that date.
We conducted our audit in accordance with the Standards on Auditing (âSAsâ) 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 Companies (Audit and Auditors) Rules, 2014 (âRulesâ) 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 are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current year. 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 below to be the key audit matters to be communicated in our report. |
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Information Technology (IT) systems |
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Key audit matter |
How our audit has addressed the key audit matter |
The Company is highly dependent on information technology systems and controls to process and record large volume of transactions, such that there exists a risk that gaps in the IT control environment could result in the financial accounting and reporting records being materially misstated. Further, IT systems are accessible to employees on a remote basis which could result in increasing challenges around data protection. |
We have involved our IT specialists in our assessment of the IT systems and controls over financial reporting, which included carrying out the following key audit procedures: ⢠Understood General IT Controls (GITC) over key financial accounting and reporting systems (referred to as âin-scope systemsâ) which covered access controls, program/ system changes, program development and computer operations i.e., job processing, data/ system backup and incident management; ⢠Tested controls over IT infrastructure covering user access including privilege users and system changes; |
Information Technology (IT) systems |
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Key audit matter |
How our audit has addressed the key audit matter |
Due to the pervasive nature, complexity and importance of the impact of the IT systems and related control environment on the Companyâs financial statements, we have identified testing of such IT systems and related control environment as a key audit matter for the current year audit. |
⢠Evaluated design and operating effectiveness for in-scope systems and application controls which covered segregation of duties, system interfaces, completeness and accuracy of data feeds and system reconciliation controls; ⢠Evaluated policies and strategies adopted by the Company in relation to operational security of key information infrastructure, data and client information management and monitoring and crisis management; and ⢠Assessed whether controls have remained unchanged during the year or were changed after considering controls around change management process. |
Valuation and impairment determination of Investments (31 March 2023: INR 2,482,204,207, 31 March 2022: INR 2,381,077,786) (INR in thousands) Refer Schedule 8,8A and 8B of the standalone financial statements and refer schedule 16 note 2.12 on accounting policy |
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Key audit matter |
How our audit has addressed the key audit matter |
The Companyâs investment portfolio consists of Policyholders investments (unit linked and non-linked) and Shareholders investments. Total investment portfolio represents 99 percent of the Companyâs total assets as at 31 March 2023. Investments are valued in accordance with the provisions of the Insurance Act, the IRDA Financial Statements Regulations, IRDAI (Investment) Regulations, 2016 orders/ directions/ circulars issued by IRDAI and/ or policies as approved by the Board of Directors of the Company (collectively the âAccounting Policyâ). Investments in unit linked portfolio of INR 1,440,580,565 thousands are valued based on observable inputs as per their accounting policy and gains/losses are recognized in Revenue account. These unit linked portfolio investments do not represent higher risk of material misstatement however, are considered to be a key audit matter due to their materiality to the standalone financial statements. Investments in non-linked and shareholders portfolio of INR 1,041,623,642 thousands are valued as per their accounting policy, based on which: ⢠the unrealized gains/ losses arising due to changes in fair value of listed equity shares and mutual fund units are recorded in the âFair Value Change Accountâ in the Balance Sheet; and ⢠debt securities and unlisted equity shares are valued at historical cost. Further, investments in the non-linked and shareholders portfolio are assessed for impairment as per the Companyâs investment policy which involves significant management judgement. There is increased economic stress on account of external factors, which may impact the valuation of these investments. Accordingly, valuation of investments (including impairment assessment) was considered to be one of the areas which required significant auditor attention and was one of the matter of most significance in the standalone financial statements. |
We have carried out the following key audit procedures: ⢠Understood the Companyâs process and tested the controls on the valuation of investments; ⢠Tested the design, implementation and operating effectiveness of key controls over the valuation process, including the Companyâs assessment and approval of assumptions used for valuation, including key authorization and data input controls thereof; ⢠Assessed valuation methodologies with reference to the Accounting Policy and the Companyâs Board approved valuation policy; ⢠For selected samples of listed investments, performed independent price checks using external quoted prices and by agreeing the inputs which were used in the Companyâs valuation techniques to external data; ⢠For selected samples of cost measured investments, we have tested Companyâs assessment of impairment and evaluated whether the same was in accordance with the Companyâs updated impairment policy; and ⢠Evaluated how the Company has factored the impact of economic stress in investment valuation process (including impairment assessment). |
INFORMATION OTHER THAN THE STANDALONE FINANCIAL STATEMENTS AND AUDITORâS REPORT THEREON
The Company''s management and Board of Directors are responsible for the other information. The other information comprises the Management Report but does not include the financial statements and our auditor''s report thereon, which we obtained prior to the date of the auditor''s report, and the Director''s Report, Corporate Governance, Management Discussion and Analysis and Enterprise Risk Management report, 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 do 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 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.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
When we read the Director''s Report, Corporate Governance, Management Discussion and Analysis and Enterprise Risk Management report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.
MANAGEMENT''S AND BOARD OF DIRECTORS RESPONSIBILITY 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 state of affairs, net surplus/deficit, profit/loss and receipts and payments of the Company in accordance with the accounting principles generally accepted in India, including the provisions of the Insurance Act, the IRDA Act, the IRDA Financial Statements Regulations and orders/directions/circulars issued by the IRDAI in this regard and Accounting Standards specified under section 133 of the Act, to the extent applicable. 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 statements 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 Management and Board of Directors 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 management and 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 are also responsible for overseeing the Company''s financial reporting process.
AUDITORâS 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.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to the financial statements in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures in the standalone financial statements made by the Management and Board of Directors.
⢠Conclude on the appropriateness of the Management and Board of Directors use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current year and are therefore, the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
The actuarial valuation of liabilities for life policies in force and policies in respect of which premium has been discontinued but liability exists as at 31 March 2023 is the responsibility of the Company''s Appointed Actuary
(the âAppointed Actuaryâ). The actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at 31 March 2023 has been duly certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the IRDAI and the Institute of Actuaries of India in concurrence with the Authority. Accordingly, we have relied upon the Appointed Actuary''s certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists in the standalone financial statements of the Company.
Our opinion is not modified in this respect of this matter.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by IRDA Financial Statements Regulations, we have issued a separate certificate dated 20 April 2023 certifying the matters specified in paragraphs 3 and 4 of Schedule C to the IRDA Financial Statements Regulations.
2. As required by the IRDA Financial Statements Regulations read with Section 143(3) of the Act, we report that:
(i) 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;
(ii) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
(iii) As the Company''s financial accounting system is centralized, no returns for the purpose of our audit are prepared at the branches and other offices of the Company;
(iv) The Standalone Balance Sheet, the Standalone Revenue Account, the standalone profit and loss account and the standalone receipts and payment account dealt with by this Report are in agreement with the books of account;
(v) The actuarial valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at 31 March 2023 has been duly certified by the Appointed Actuary. The Appointed Actuary has also certified that, in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by IRDAI and the Institute of Actuaries of India in concurrence with the Authority;
(vi) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards prescribed under Section 133 of the Act, to the extent not inconsistent with the accounting principles prescribed in the IRDA Financial Statements Regulations and orders/ directions/ circulars issued by IRDAI in this regard;
(vii) In our opinion and to the best of our information and according to the explanations given to us, investments have been valued in accordance with the provisions of the Insurance Act, the IRDA Financial Statements Regulations and orders/ directions/ circulars issued by IRDAI in this regard;
(viii) In our opinion, the accounting policies selected by the Company are appropriate and are in compliance with the Accounting Standards specified under Section 133 of the Act, to the extent they are not inconsistent with the accounting principles as prescribed in the IRDA Financial Statements Regulations and orders/directions/circulars issued by the IRDAI in this regard;
(ix) On the basis of written representations received from the directors as on 31 March 2023 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2023 from being appointed as a director in terms of Section 164(2) of the Act;
(x) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ; and
(xi) 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:
(a) The Company has disclosed the impact of pending litigations as at 31 March 2023 on its financial position in its standalone financial statements - Refer Schedule 16 note 3.2 to the standalone financial statements;
(b) The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on longterm contracts including derivative contracts -Refer Schedule 16 note 3.48 to the standalone financial statements;
(c) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company;
(d) (i) The management has represented that, to the
best of its 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 persons or entities, including foreign entities (âIntermediariesâ), 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 (âUltimate Beneficiariesâ) by or on behalf of the Company; or
⢠provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries (refer schedule 16 note 3.53(a) to the standalone financial statements).
(ii) The management has represented, that, to the best of its knowledge and belief, no funds have been received by the Company from any persons or entities, including foreign entities (âFunding Partiesâ), 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 (âUltimate Beneficiariesâ) by or on behalf of the Funding Party; or
⢠provide any guarantee, security or the like from or on behalf of the Ultimate Beneficiaries (refer schedule 16 note 3.53(b) to the standalone financial statements).
(iii) Based on such audit procedures as considered reasonable and appropriate in the circumstances, nothing has come to the notice that has caused them to believe that the representations under sub-clause (d) (i) and (ii) contain any material misstatement.
(e) The dividend declared or paid during the year by the Company is in compliance with section 123 of the Act.
(f) As proviso to rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable for the Company only with effect from 1 April 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 is not applicable.
3. With respect to the matter to be included in the Auditor''s Report under section 197(16) of the Act, in our opinion and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of Section 197 of the Act read with Section 34A of the Insurance Act,1938. The remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act read with Section 34A of the Insurance Act,1938. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) which are required to be commented upon by us.
For B S R & Co. LLP For Walker Chandiok & Co LLP
Chartered Accountants Chartered Accountants
ICAI Firm Registration No: 101248W/W-100022 ICAI Firm Registration No: 001076N/N500013
Kapil Goenka Sudhir N. Pillai
Partner Partner
Membership No: 118189 Membership No: 105782
UDIN: 23118189BGURDM5448 UDIN: 23105782BGXTBA6268
Place: Mumbai Place: Mumbai
Date: 20 April 2023 Date: 20 April 2023
Mar 31, 2022
ICICI Prudential Life Insurance Company Limited
REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS
We have audited the accompanying standalone financial statements of ICICI Prudential Life Insurance Company Limited (the "Company"), which comprise the Balance Sheet as at 31 March 2022, the Revenue Account (also called the "Policyholders' Account" or the "Technical Account"), the Profit and Loss Account (also called the "Shareholders' Account" or the "Non-Technical Account") and the Receipts and Payments Account for the year then ended, and notes to standalone financial statements, including a summary of significant 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 in accordance with the Insurance Act, 1938 (the "Insurance Act"), the Insurance Regulatory and Development Authority Act, 1999 (the "IRDA Act"), the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditors' Report of Insurance Companies) Regulations, 2002 (the
"IRDA Financial Statements Regulations"), orders/ directions/circulars issued by the Insurance Regulatory and Development Authority of India (the "IRDAI") and the Companies Act, 2013 (the "Act"), to the extent applicable, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Accounting Standards prescribed under section 133 of the Act, to the extent applicable, of the state of affairs of the Company as at 31 March 2022, its net surplus, its profit and its receipts and payments for the year ended on that date.
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 are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current year. 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 below to be the key audit matters to be communicated in our report.
Information Technology (IT) systems |
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Key audit matter |
How our audit has addressed the key audit matter |
The Company is highly dependent on information technology systems and controls to process and record large volume of transactions, such that there exists a risk that gaps in the IT control environment could result in the financial accounting and reporting records being materially misstated. Further, IT systems are accessible to employees on a remote basis which could result in increasing challenges around data protection. Due to the pervasive nature, complexity and importance of the impact of the IT systems and related control environment on the Company's financial statements, we have identified testing of such IT systems and related control environment as a key audit matter for the current year audit. |
We have involved our IT specialists in our assessment of the IT systems and controls over financial reporting, which included carrying out the following key audit procedures: ⢠   Understood General IT Controls (GITC) over key financial accounting and reporting systems (referred to as "in-scope systems") which covered access controls, program/ system changes, program development and computer operations i.e. job processing, data/ system backup and incident management; ⢠   Understood the IT infrastructure i.e. operating systems and databases and related data security controls in remote working scenario due to COVID-19; ⢠   Tested controls over IT infrastructure covering user access including privilege users and system changes; ⢠   Evaluated design and operating effectiveness for in-scope systems and application controls which covered segregation of duties, system interfaces, completeness and accuracy of data feeds and system reconciliation controls; ⢠   Evaluated policies and strategies adopted by the Company in relation to operational security of key information infrastructure, data and client information management and monitoring and crisis management; and ⢠   Assessed whether controls have remained unchanged during the year or were changed after considering controls around change management process. |
Valuation and impairment determination of Investments (31 March 2022: INR 2,381,077,786, 31 March 2021: INR 2,122,118,584) |
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(INR in Thousands) |
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Refer Schedule 8,8A and 8B of the standalone financial statements and refer schedule 16 note 2.11 on accounting policy |
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Key audit matter |
How our audit has addressed the key audit matter |
The Company's investment portfolio consists of Policyholders investments (unit |
We have carried out the following key audit procedures: |
linked and non-linked) and Shareholders investments. Total investment portfolio represents 97 percent of the Company's total assets as at 31 March 2022. |
⢠Understood the Company's process and tested the controls on the valuation of investments; |
Investments are valued in accordance with the provisions of the Insurance Act, the IRDA Financial Statements Regulations, orders/ directions/ circulars issued by IRDAI and / or policies as approved by the Board of Directors of the Company (collectively the "Accounting Policy"). |
⢠Tested the design, implementation and operating effectiveness of key controls over the valuation process, including the Company's assessment and approval of assumptions used for valuation, including key authorization and data input controls thereof; |
Investments in unit linked portfolio of INR 1,508,663,021 thousands are valued based on observable inputs as per their accounting policy and gains/losses are recognized in Revenue account. These unit linked portfolio investments do not |
⢠Assessed valuation methodologies with reference to the Accounting Policy and the Company's Board approved valuation policy; |
represent higher risk of material misstatement however, are considered to be a |
⢠For selected samples of listed investments, performed independent price |
key audit matter due to their materiality to the standalone financial statements. |
checks using external quoted prices and by agreeing the inputs which were |
Investments in non-linked and shareholders portfolio of INR 872,414,765 |
used in the Company's valuation techniques to external data; |
thousands are valued as per their accounting policy, based on which: |
⢠For selected samples of cost measured investments, we have tested |
⢠the unrealized gains/ losses arising due to changes in fair value of |
Company's assessment of impairment and evaluated whether the same |
listed equity shares and mutual fund units are recorded in the "Fair |
was in accordance with the Company's impairment policy; and |
Value Change Account" in the Balance Sheet; and |
⢠Evaluated how the Company has factored the impact of economic stress |
⢠debt securities and unlisted equity shares are valued at historical cost. |
including COVID-19 disruptions in investment valuation process (including |
Further, investments in the non-linked and shareholders portfolio are assessed for impairment as per the Company's investment policy which involves significant management judgement. There is increased economic stress on account of external factors, including the COVID-19 pandemic, which may impact the determination of impairment of these investments. |
impairment assessment). |
Accordingly, valuation of investments (including impairment assessment) was considered to be one of the areas which required significant auditor attention and |
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INFORMATION OTHER THAN THE STANDALONE FINANCIAL STATEMENTS AND AUDITOR'S REPORT THEREON
The Company's management and Board of Directors are responsible for the other information. The other information comprises the Management Report (but does not include the financial statements and our auditor's report thereon), which we obtained prior to the date of the auditor's report, and the Directors' Report, Corporate Governance, Management Discussion and Analysis and Enterprise Risk Management report, which is expected to be made available to us after that date.
Our opinion on the financial statements does not cover the other information and we do not and will not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of this auditor's report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
When we read the Directors' Report, Corporate Governance, Management Discussion and Analysis and Enterprise Risk Management report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.
MANAGEMENT'S AND BOARD OF DIRECTORS RESPONSIBILITY 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 state of affairs, net surplus/deficit, profit/loss and receipts and payments of the Company in accordance with the accounting principles generally accepted in India, including the provisions of the Insurance Act, the IRDA Act, the IRDA Financial Statements Regulations and orders/ directions/circulars issued by the IRDAI in this regard and Accounting Standards specified under section 133 of the Act, to the extent applicable. 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 statements 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 Management and Board of Directors 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 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 are 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.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠   Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠   Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to the financial statements in place and the operating effectiveness of such controls.
⢠   Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures in the standalone financial statements made by the Management and Board of Directors.
⢠   Conclude on the appropriateness of the Management and Board of Directors use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current year and are therefore, the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
The actuarial valuation of liabilities for life policies in force and policies in respect of which premium has been discontinued but liability exists as at 31 March 2022 is the responsibility of the Company's Appointed Actuary (the "Appointed Actuary"). The actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at 31 March 2022 has been duly certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the IRDAI and the Institute of Actuaries of India in concurrence with the Authority. Accordingly, we have relied upon the Appointed Actuary's certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists in the standalone financial statements of the Company. Our opinion is not modified in this respect of this matter.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1.    As required by IRDA Financial Statements Regulations, we have issued a separate certificate dated 16 April 2022 certifying the matters specified in paragraphs 3 and 4 of Schedule C to the IRDA Financial Statements Regulations.
2.    As required by the IRDA Financial Statements Regulations read with Section 143(3) of the Act, we report that:
(i)    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;
(ii)    In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
(iii)    As the Company's financial accounting system is centralized, no returns for the purpose of our audit are prepared at the branches and other offices of the Company;
(iv)    The standalone balance sheet, the standalone revenue account, the standalone profit and loss account and the standalone receipts
and payment account dealt with by this Report are in agreement with the books of account;
(v)    The actuarial valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at 31 March 2022 has been duly certified by the Appointed Actuary. The Appointed Actuary has also certified that, in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by IRDAI and the Institute of Actuaries of India in concurrence with the Authority;
(vi)    In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards prescribed under Section 133 of the Act, to the extent not inconsistent with the accounting principles prescribed in the IRDA Financial Statements Regulations and orders/ directions/ circulars issued by IRDAI in this regard;
(vii)    In our opinion and to the best of our information and according to the explanations given to us, investments have been valued in accordance with the provisions of the Insurance Act, the IRDA Financial Statements Regulations and orders/ directions/ circulars issued by IRDAI in this regard;
(viii)    In our opinion, the accounting policies selected by the Company are appropriate and are in compliance with the Accounting Standards specified under Section 133 of the Act, to the extent they are not inconsistent with the accounting principles as prescribed in the IRDA Financial Statements Regulations and orders/directions/ circulars issued by the IRDAI in this regard;
(ix)    On the basis of written representations received from the directors as on 31 March 2022 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2022 from being appointed as a director in terms of Section 164(2) of the Act;
(x)    With respect to the adequacy of the internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure A"; and
(xi)    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:
(a)    The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Schedule 16 note 3.2 to the standalone financial statements;
(b)    The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts - Refer Schedule 16 note 3.47 to the standalone financial statements;
(c)    There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company;
(d) Â Â Â (i) The management has represented that, to the best
of its 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 persons or entities, 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 ("Ultimate Beneficiaries") by or on behalf of the Company; or
⢠   provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
(ii)    The management has represented, that, to the best of its knowledge and belief, no funds have been received by the Company from any persons or entities, 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 ("Ultimate Beneficiaries") by or on behalf of the Funding Party; or
⢠   provide any guarantee, security or the like from or on behalf of the Ultimate Beneficiaries.
(iii)    Based on such audit procedures as considered reasonable and appropriate in the circumstances, nothing has come to the notice that has caused them to believe that the representations under sub-clause (d) (i) and (ii) contain any material misstatement.
(e)    The dividend declared or paid during the year by the Company is in compliance with section 123 of the Act.
3. With respect to the matter to be included in the Auditor's Report under section 197(16), in our opinion and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of Section 197 of the Act read with Section 34A of the Insurance Act,1938. The remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act read with Section 34A of the Insurance Act,1938. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) which are required to be commented upon by us.
Mar 31, 2021
iCiCi Prudential Life insurance Company Limited
REPORT ON THE AUDiT OF THE STANDALONE FiNANCiAL STATEMENTS
OPINION
We have audited the accompanying standalone financial statements of iCiCi Prudential Life insurance Company Limited (the "Company"), which comprise the Balance Sheet as at 31 March 2021, the Revenue Account (also called the "Policyholders' Account" or the "Technical Account"), the Profit and Loss Account (also called the "Shareholders' Account" or the "Non-Technical Account") and the Receipts and Payments Account for the year then ended, and notes to standalone financial statements, including a summary of significant 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 in accordance with the insurance Act, 1938 (the "insurance Act"), the insurance Regulatory and Development Authority Act, 1999 (the "iRDA Act"), the insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditors' Report of insurance Companies) Regulations, 2002 (the "iRDA Financial
Statements Regulations"), orders/ directions/circulars issued by the insurance Regulatory and Development Authority of india (the "iRDAi") and the Companies Act, 2013 (the "Act"), to the extent applicable, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in india including the Accounting Standards prescribed under section 133 of the Act, to the extent applicable, of the state of affairs of the Company as at 31 March 2021, its net surplus, its profit and its receipts and payments for the year ended on that date.
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
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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 year. 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 below to be the key audit matters to be communicated in our report.
information Technology (it) systems |
|
Key audit matter |
How our audit has addressed the key audit matter |
The Company is highly dependent on information systems and controls to process and record large volume of transactions, such that there exists a risk that gaps in the iT control environment could result in the financial accounting and reporting records being materially misstated. in addition, due to the COViD-19 situation, iT systems have been made accessible to employees on a remote basis which has resulted in increasing challenges around the data protection. Due to the pervasive nature, complexity and importance of the impact of the iT systems and related control environment on the Company's financial reporting process, we have identified testing of such iT systems and related control environment as a key audit matter for the current year audit. |
We have involved our iT specialists in our assessment of the iT systems and controls over financial reporting, which included carrying out the following key audit procedures: ⢠   Understood General IT Controls (GITC) over key financial accounting and reporting systems (referred to as "in-scope systems") which covered access controls, program/ system changes, program development and computer operations i.e. job processing, data/ system backup and incident management; ⢠   Understood the IT infrastructure i.e. operating systems and databases and related data security controls in remote working scenario due to COViD-19; ⢠   Tested controls over IT infrastructure covering user access including privilege users and system changes; ⢠   Evaluated design and operating effectiveness for in-scope systems and application controls which covered segregation of duties, system interfaces, completeness and accuracy of data feeds and system reconciliation controls; |
Key audit matter |
How our audit has addressed the key audit matter |
⢠   Evaluated policies and strategies adopted by the Company in relation to operational security of key information infrastructure, data and client information management and monitoring and crisis management; and ⢠   Assessed whether controls have remained unchanged during the year or were changed after considering controls around change management process. |
Valuation of investments (31 march 2021: iNR 2,122,118,584, 31 march 2020: iNR 1,512,561,978) (iNR in Thousand) |
|
refer schedule 8,8A and 8B of the standalone financial statements and refer schedule 16 note 2.12 on accounting policy |
|
Key audit matter |
How our audit has addressed the key audit matter |
the Company's investment portfolio consists of policyholders investments |
we have carried out the following key audit procedures: |
(unit linked and non-linked) and shareholders investments. the Company's investment portfolio represents 99 percent of the Company's total assets as at 31 march 2021. the investments are valued in accordance with the |
⢠Understood the Company's process and tested the controls on the valuation of investments; |
accounting policy framed as per insurance regulatory and development authority of india (investment) regulations, 2016 (the "investment regulations") issued by IRDAI and / or policies approved by the Board of Directors of the Company (collectively 'the accounting policy'). |
⢠Tested the design, implementation and operating effectiveness of key controls over the valuation process, including the Company's assessment and approval of estimates and assumption used for valuation including key authorization and data input controls thereof; |
investments in unit linked portfolio of INR 1,385,491,431 thousand are valued based on observable inputs as per their accounting policy and gains/losses are recognized in revenue account. These unit linked |
⢠Assessed valuation methodologies with reference to Investment regulations issued by IRDAI and the Company's own Board approved |
portfolio investments do not represent an area of higher risk of material |
valuation policy; |
misstatement, however, are considered as a key audit matter due to their materiality to the standalone financial statements. |
⢠For selected samples of listed investments, performed independent price checks using external quoted prices and by agreeing the inputs |
investments in non-linked and shareholders portfolio of iNR 736,627,153 |
which were used in the Company's valuation techniques to external |
thousand are valued as per their accounting policy, basis which: |
data; |
⢠the unrealized gains/ losses arising due to changes in fair value of listed equity shares and mutual fund units are taken to the "Fair |
⢠For selected samples of cost measured investments, we have tested |
Value Change Account" in Balance Sheet; and |
Company's assessment of impairment and evaluated whether the |
⢠debt securities and unlisted equity shares are valued at historical cost. |
same was in accordance with the Company's impairment policy; and |
Further, these investments in the non-linked and shareholders portfolio |
⢠Evaluated how the Company has factored in the impact of COVID-19 |
are assessed for impairment as per the Company's investment policy which involves significant management judgement. |
disruptions in the investment valuation process (including impairment assessment). |
Further, there may be increased economic stress in various sectors due to the C0ViD-19 pandemic and which may have an impact on the valuation of investments, which is relevant in undertaking impairment assessment. |
 |
Hence, the valuation of investments (including impairment assessment) was considered to be one of the areas which would require significant auditor attention and one of the matter of most significance in the standalone financial statements. |
 |
iNFORMATiON OTHER THAN THE STANDALONE FiNANCiAL STATEMENTS AND AUDITOR'S REPORT THEREON
The Company's management and Board of Directors are responsible for the other information. The other information comprises the Management Report, Director's Report, Corporate Governance, Management Discussion and Analysis and Enterprise Risk Management included in the Company's Annual report, but does not include the standalone financial statements and the auditor's report thereon. our opinion on the standalone financial statements does not cover the other information and we do not and 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 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. if, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. we have nothing to report in this regard.
MANAGEMENT'S AND BOARD OF DiRECTORS RESPONSiBiUTY FOR THE STANDALONE FiNANCiALÂ 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 state of affairs, net surplus/deficit, profit/loss and receipts and payments of the Company in accordance with the accounting principles generally accepted in india, including the provisions of the insurance act, the IRDA act, the IRDA Financial statements Regulations and orders/directions/circulars issued by the IRDAI in this regard and accounting standards specified under section 133 of the act, to the extent applicable. 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 statements 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 management and Board of directors 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 management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
those Board of directors are 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.
As part of an audit in accordance with sAs, we exercise professional judgment and maintain professional skepticism throughout the audit. we also:
⢠Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. the risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
⢠   Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to the financial statements in place and the operating effectiveness of such controls.
⢠   Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures in the standalone financial statements made by the management and Board of Directors.
⢠   Conclude on the appropriateness of the Management and Board of Directors use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠   Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
we communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
we also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current year and are therefore, the key audit matters. we describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
the actuarial valuation of liabilities for life policies in force and policies in respect of which premium has been discontinued but liability exists as at 31 march 2021 is the responsibility of the Company's Appointed Actuary (the "Appointed Actuary"). the actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at 31 march 2021 has been duly
For B S R & Co. LLP    For Walker Chandiok & Co LLP
Chartered Accountants    Chartered Accountants
ICAI Firm Registration No: 101248W/W-100022 Â Â Â ICAI Firm Registration No: 001076N/N500013
Sagar Lakhani    Khushroo B. Panthaky
Partner    Partner
Membership No: 111855 Â Â Â Membership No: 042423
UDIN: 21111855AAAABI1301 Â Â Â UDIN: 21042423AAAACR3976
Place: Mumbai    Place: Mumbai
Date: 19 April 2021 Â Â Â Date: 19 April 2021
Â
certified by the Appointed Actuary and in her opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the iRDai and the institute of actuaries of india in concurrence with the authority. accordingly, we have relied upon the appointed actuary's certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists in the standalone financial statements of the Company. our opinion is not modified in this respect of this matter.
REPORT ON OTHER LEGAL AND REGULATORY REQUiREMENTS
1.    As required by IRDA Financial statements regulations, we have issued a separate certificate dated 19 April 2021 certifying the matters specified in paragraphs 3 and 4 of schedule C to the IRDA Financial statements Regulations.
2.    As required by the IRDA Financial statements regulations read with 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;
b)    i n our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
c)    As the Company's financial accounting system is centralized, no returns for the purpose of our audit are prepared at the branches and other offices of the Company;
d)    The standalone balance sheet, the standalone revenue account, the standalone profit and loss account and the standalone receipts and payment account dealt with by this Report are in agreement with the books of account;
e)    i n our opinion, the aforesaid standalone financial statements comply with the Accounting standards prescribed under section 133 of the Act, to the extent not inconsistent with the accounting principles prescribed in the iRDA Financial statements regulations and orders/ directions/ circulars issued by IRDAI in this regard;
f)    in our opinion and to the best of our information and according to the explanations given to us, investments have been valued in accordance with the provisions of the insurance Act, the iRDA Financial statements Regulations and orders/ directions/ circulars issued by iRDAi in this regard;
g)    in our opinion, the accounting policies selected by the Company are appropriate and are in compliance with the Accounting standards specified under section 133 of the Act, to the extent
they are not inconsistent with the accounting principles as prescribed in the iRDA Financial statements Regulations and orders/directions/circulars issued by the iRDAi in this regard;
h)    on the basis of written representations received from the directors as on 31 March 2021 taken on record by the Board of Directors, none of the directors is disqualified as on 31 march 2021 from being appointed as a director in terms of section 164(2) of the Act;
i)    with respect to the adequacy of the internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure A";
j)    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 schedule 16 note 3.46 to the standalone financial statements;
ii.    The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts - Refer schedule 16 note 3.47 to the standalone financial statements;
iii.    There were no amounts which were required to be transferred to the investor Education and Protection Fund by the Company; and
iv.    The disclosures in the standalone financial statements regarding holdings as well as dealings in specified bank notes is not applicable to the Company - Refer schedule 16 note 3.50 to the standalone financial statements.
k)    With respect to the matter to be included in the Auditor's Report under section 197(16), in our opinion and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act read with section 34A of the insurance Act. The remuneration paid to any director is not in excess of the limit laid down under section 197 of the Act read with section 34A of the insurance Act. The Ministry of Corporate Affairs has not prescribed other details under section 197(16) which are required to be commented upon by us.
Mar 31, 2019
REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS
OPINION
We have audited the standalone financial statements of ICICI Prudential Life Insurance Company Limited (the âCompanyâ), which comprise the Balance Sheet as at March 31, 2019, the Revenue Account (also called the âPolicyholdersâ Accountâ or the âTechnical Accountâ), the Profit and Loss Account (also called the âShareholdersâ Accountâ or the âNonTechnical Accountâ) and the Receipts and Payments Account for the year then ended and a summary of significant 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 in accordance with the Insurance Act, 1938 (the âInsurance Actâ), the Insurance Regulatory and Development Authority Act, 1999 (the âIRDA Actâ), the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditorsâ Report of Insurance Companies) Regulations, 2002 (the âIRDA Financial Statements Regulationsâ) and the Companies Act, 2013 (the âActâ), to the extent applicable, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Accounting Standards prescribed under section 133 of the Act, to the extent applicable:
(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2019;
(b) in the case of Revenue Account, of the net surplus for the year ended on that date;
(c) in the case of Profit and Loss Account, of the profit for the year ended on that date; and
(d) in the case of the Receipts and Payments Account, of the receipts and payments 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 Standards are further described in the Auditorâs 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 year. 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 below to be the key audit matters to be communicated in our report.
Information technology systems
(Refer Internal control systems and their adequacy under âManagement Discussion and Analysisâ)
Key Audit Matter |
How our audit has addressed the key audit matter |
The Companyâs key financial accounting and reporting processes are highly dependent on information systems including automated controls in systems, such that there exists a risk that gaps in the IT control environment could result in the financial accounting and reporting records being misstated. The Company uses several systems for it overall financial reporting. |
We involved our IT Specialist to: - Understand General IT Control (GITC) i.e. Access Controls, Program/ System Change, Program Development, Computer Operations (i.e. Job Processing, Data/System Backup Incident Management) over key financial accounting and reporting systems, and supporting control systems (referred to as in-scope systems); - Test the General IT Controls for design and operating effectiveness for the audit period over the in-scope systems; - Understand IT application controls covering: o user access and roles, segregation of duties; and o key interfaces, reports, reconciliations and system processing; - Test the IT application controls for design and operating effectiveness for the audit period; |
We have identified âInformation Technology systemsâ as key audit matter because of the high level automation, significant number of systems being used by the management and the complexity of the IT architecture. |
- Test the controls to determine whether these controls remained unchanged during the audit period or were changed following the standard change management process; - Understand IT infrastructure i.e. operating systems and databases supporting the in-scope systems; and - Test the controls over the IT infrastructure covering user access (including privilege users), data center and system change (e.g. patches). |
Valuation of Investments (March 31, 2019: 1,590,085,424, March 31, 2018: 1,385,401,098) (INR in Thousands) Refer note 2.11 (Investments) and note 3.25 (Impairment of investment assets) |
|
Key Audit Matter |
How our audit has addressed the key audit matter |
The Companyâs investment portfolio represents substantial portion of the Companyâs total assets as at March 31, 2019 which are valued in accordance with accounting policy framed as per the extent of the regulatory guidelines. Investment in Non-linked and shareholdersâ portfolio: All debt securities are valued at amortised cost and investment property is valued in accordance with Companyâs valuation policy. The listed equity shares, preference shares, liquid mutual fund and Equity Exchange Traded Funds (ETF) investments are valued using quoted prices as per stock exchanges. These investments are tested for impairment in accordance with the Companyâs impairment policy. Investment in unit linked portfolio: Government securities are valued at prices provided by CRISIL. Other debt securities are valued on a yield to maturity basis, by using spread over the benchmark rate. The listed equity shares, preference shares, liquid mutual fund and ETF investments are valued using quoted prices as per stock exchanges. The valuation of these investments was considered to be one of the areas which required significant auditor attention and was one of the matter of most significance in the standalone financial statements due to the materiality of total value of investments to the financial statements. |
Our audit procedures for this area included but were not limited to the following: - Tested the design, implementation and operating effectiveness of key controls over the valuation process, including the Companyâs review and approval of the estimates and assumptions used for the valuation including key authorisation and data input controls; - Assessed appropriateness of the valuation methodologies with reference to Investment Regulations issued by Insurance Regulatory and Development Authority of India (âIRDAIâ/ âAuthorityâ) and Companyâs own valuation policy; - For listed equity shares, preference shares, liquid mutual fund and ETF investments, performed independent price checks using external quoted prices and by agreeing the observable inputs that were used in the Companyâs valuation techniques to external data; and - For other investments, critically evaluated the valuation assessment and resulting conclusions by the Company in order to determine the reasonableness of the valuations recorded. This included an evaluation of the methodology and assumptions used in the valuation with reference to the Companyâs valuation policy. |
INFORMATION OTHER THAN THE STANDALONE FINANCIAL STATEMENTS AND AUDITORâS REPORT THEREON
The Companyâs management and Board of Directors are responsible for the other information. The other information comprises the information included in the Companyâs Annual Report, but does not include the standalone financial statements and our auditorâs report thereon.
Our opinion on the standalone financial statements does not cover the other information and we do 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 and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
RESPONSIBILITIES OF MANAGEMENT AND THOSE CHARGED WITH GOVERNANCE FOR THE STANDALONE FINANCIAL STATEMENTS
The Companyâs 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 state of affairs, net surplus/deficit, profit/loss and receipts and payments of the Company in accordance with the accounting principles generally accepted in India, including the provisions of the Insurance Act, the IRDA Act, the IRDA Financial Statements Regulations and orders/directions/circulars issued by the IRDAI in this regard, and Accounting Standards specified under section 133 of the Act, to the extent applicable. 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 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, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
AUDITORâS 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 auditorâs 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.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
- Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to the financial statements in place and the operating effectiveness of such controls.
- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
- Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern.
- Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current year and are therefore, the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication
OTHER MATTER - SCOPE OF AUDIT
The actuarial valuation of liabilities for life policies in force and policies in respect of which premium has been discontinued but liability exists as at March 31, 2019 is the responsibility of the Companyâs Appointed Actuary (the âAppointed Actuaryâ). The actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at March 31, 2019 has been duly certified by the Appointed Actuary and in her opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the IRDAI and the Institute of Actuaries of India in concurrence with the Authority. Accordingly, we have relied upon the Appointed Actuaryâs certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists in the standalone financial statements of the Company. Our opinion is not modified in this respect of this matter.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by IRDA Financial Statements Regulations, we have issued a separate certificate dated April 24, 2019 certifying the matters specified in paragraphs 3 and 4 of Schedule C to the IRDA Financial Statements Regulations.
2. As required by the IRDA Financial Statements Regulations, read with 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 and have found them to be satisfactory;
b) In our opinion and to the best of our information and according to the explanations given to us, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
c) As the Companyâs financial accounting system is centralised, no returns for the purpose of our audit are prepared at the branches of the Company;
d) The Balance Sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payment Account dealt with by this Report are in agreement with the books of account;
e) In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements comply with the Accounting Standards prescribed under Section 133 of the Act, to the extent not inconsistent with the accounting principles prescribed in the IRDA Financial Statements Regulations and orders/ directions/ circulars issued by IRDAI in this regard;
f) In our opinion and to the best of our information and according to the explanations given to us, investments have been valued in accordance with the provisions of the Insurance Act, the IRDA Financial Statements Regulations and orders/ directions/ circulars issued by IRDAI in this regard;
g) In our opinion and to the best of our information and according to the explanations given to us, the accounting policies selected by the Company are appropriate and are in compliance with the Accounting Standards specified under Section 133 of the Act and with the accounting principles as prescribed in the IRDA Financial Statements Regulations and orders/directions/circulars issued by the IRDAI in this regard;
h) On the basis of written representations received from the directors as on March 31, 2019 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2019 from being appointed as a director in terms of Section 164(2) of the Act;
i) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ; and
j) With respect to the other matters to be included in the Auditorâs 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 Schedule 16 note 3.44 to the standalone financial statements;
ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts - Refer Schedule 16 note 3.45 to the standalone financial statements;
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company during the year ended March 31, 2019; and
iv. The disclosures in the standalone financial statements regarding holdings as well as dealings in specified bank notes is not applicable to the Company - Refer Schedule 16 note 3.48 to the standalone financial statements.
k) With respect to the matter to be included in the Auditorâs Report under section 197(16), in our opinion and according to the explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of Section 197 of the Act, to the extent applicable. The remuneration paid to any director, to the extent applicable is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) which are required to be commented upon by us.
REPORT ON THE INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE AFORESAID STANDALONE FINANCIAL STATEMENTS UNDER CLAUSE (I) OF SUB-SECTION 3 OF SECTION 143 OF THE COMPANIES ACT, 2013
(Referred to in paragraph 2(i) under âReport on Other Legal and Regulatory Requirementsâ section of our report of even date)
We have audited the internal financial controls with reference to the standalone financial statements of ICICI Prudential Life Insurance Company Limited (the âCompanyâ) as of March 31, 2019 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
MANAGEMENTâS RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
The Companyâs management and the Board of Directors are responsible for establishing and maintaining internal financial controls based on the internal financial controls with reference to standalone financial statements 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 (the âGuidance Noteâ). 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 companyâs 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 (hereinafter referred to as the âActâ).
AUDITORâS RESPONSIBILITY
Our responsibility is to express an opinion on the Companyâs internal financial controls with reference to the standalone financial statements based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls with reference to standalone financial statements. 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 with reference to standalone financial statements were established and maintained and whether 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 with reference to standalone financial statements and their operating effectiveness. Our audit of internal financial controls with reference to the standalone financial statements included obtaining an understanding of such internal financial controls, 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 auditorâs judgement, including the assessment of the risks of material misstatement of the standalone 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 Companyâs internal financial controls with reference to the standalone financial statements.
MEANING OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO STANDALONE FINANCIAL STATEMENTS
A Companyâs internal financial controls with reference to standalone financial statements 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 Companyâs internal financial controls with reference to standalone financial statements include 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 authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companyâs assets that could have a material effect on the financial statements.
INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO STANDALONE FINANCIAL STATEMENTS
Because of the inherent limitations of internal financial controls with reference to standalone financial statements, 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 with reference to standalone financial statements to future periods are subject to the risk that the internal financial controls with reference to standalone financial statements 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 with reference to the standalone financial statements and such internal financial controls were operating effectively as at March 31, 2019, based on the internal controls with reference to standalone financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note.
OTHER MATTER
The actuarial valuation of liabilities for life policies in force and policies in respect of which premium has been discontinued but liability exists as at March 31, 2019 has been certified by the Appointed Actuary as per the IRDA Financial Statements Regulations, and has been relied upon by us, as mentioned in âOther Matterâ of our audit report on the standalone financial statements for the year ended March 31, 2019. Accordingly, our opinion on the internal financial controls with reference to the standalone financial statements does not include reporting on the operating effectiveness of the managementâs internal controls over the valuation and accuracy of the aforesaid actuarial valuation. Our opinion is not modified in respect of the above matter.
For B S R & Co. LLP For walker Chandiok & Co LLP
Chartered Accountants Chartered Accountants
ICAI Firm Registration No:101248W/W-100022 ICAI Firm Registration No: 001076N/N500013
Manoj Kumar vijai Khushroo B. Panthaky
Partner Partner
Membership No: 046882 Membership No: 42423
Mumbai Mumbai
April 24, 2019 April 24, 2019
Mar 31, 2018
REPORT ON THE STANDALONE FINANCIAL STATEMENTS
We have audited the accompanying standalone financial statements of ICICI Prudential Life Insurance Company Limited (the âCompanyâ), which comprise the Balance Sheet as at March 31, 2018, the Revenue Account (also called the âPolicyholdersâ Accountâ or the âTechnical Accountâ), the Profit and Loss Account (also called the âShareholdersâ Accountâ or the âNon-Technical Accountâ) and the Receipts and Payments Account for the year then ended and a summary of significant accounting policies and other explanatory information.
MANAGEMENTâS RESPONSIBILITY FOR THE STANDALONE FINANCIAL STATEMENTS
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (the âActâ) with respect to the preparation of these standalone financial statements that give a true and fair view of the state of affairs, net surplus, profit and receipts and payments of the Company in accordance with the accounting principles generally accepted in India, including the provisions of The Insurance Act, 1938 (amended by the Insurance Laws (Amendment) Act, 2015) (the âInsurance Actâ), the Insurance Regulatory and Development Authority Act, 1999 (the âIRDA Actâ), the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditorsâ Report of Insurance Companies) Regulations, 2002 (the âIRDA Financial Statements Regulationsâ) and orders/directions/circulars issued by the Insurance Regulatory and Development Authority of India (âIRDAIâ/ âAuthorityâ) in this regard, and Accounting Standards specified under Section 133 of the Act, to the extent applicable.
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 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 statements 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, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
AUDITORSâ RESPONSIBILITY
Our responsibility is to express an opinion on these standalone financial statements based on our audit. We have taken into account the provisions of the Act, the Insurance Act, the IRDA Act, the IRDA Financial Statement Regulations, orders/ directions/ circulars issued by the IRDAI, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and Rules made thereunder.
We conducted our audit of standalone financial statements in accordance with the Standards on Auditing 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 standalone financial statements. The procedures selected depend on the auditorsâ judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the 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 the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the standalone financial statements.
We are also responsible to conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the entityâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in the auditorsâ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify the opinion. Our conclusions are based on the audit evidence obtained up to the date of the auditorsâ report. However, future events or conditions may cause an entity to cease to continue as a going concern.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
OPINION
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 in accordance with the Insurance Act, the IRDA Act, the IRDA Financial Statements Regulations and the Act to the extent applicable and in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India, as applicable to Insurance Companies:
(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2018;
(b) in the case of Revenue Account, of the net surplus for the year ended on that date;
(c) in the case of Profit and Loss Account, of the profit for the year ended on that date; and
(d) in the case of the Receipts and Payments Account, of the receipts and payments for the year ended on that date.
OTHER MATTERS
The actuarial valuation of liabilities for life policies in force and policies where premium is discontinued is the responsibility of the Companyâs Appointed Actuary (the âAppointed Actuaryâ). The actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at March 31, 2018 has been duly certified by the Appointed Actuary and in her opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the IRDAI and the Institute of Actuaries of India in concurrence with the Authority. We have relied upon the Appointed Actuaryâs certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists, as contained in the standalone financial statements of the Company. Our opinion is not modified in respect of this matter.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the IRDA Financial Statements Regulations, we have issued a separate certificate dated April 24, 2018 certifying the matters specified in paragraphs 3 and 4 of Schedule C to the IRDA Financial Statements Regulations.
2. As required by the IRDA Financial Statements Regulations, read with 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 and have found them to be satisfactory;
(b) In our opinion and to the best of our information and according to the explanations given to us, 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) As the Companyâs financial accounting system is centralised, no returns for the purposes of our audit are prepared at the branches of the Company;
(d) The Balance Sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account dealt with by this Report are in agreement with the books of account;
(e) In our opinion and to the best of our information and according to the explanations given to us, investments have been valued in accordance with the provisions of the Insurance Act, the Regulations and orders/ directions/ circulars issued by IRDAI in this regard;
(f) I n our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act to the extent not inconsistent with the accounting principles prescribed in the IRDA Financial Statements Regulations and orders/ directions/ circulars issued by IRDAI in this regard;
(g) I n our opinion and to the best of our information and according to the explanations given to us, the accounting policies selected by the Company are appropriate and are in compliance with the Accounting Standard referred to in Section 133 of the Companies Act and with the accounting principles as prescribed in the IRDAI Financial Statements Regulations and orders/directions issued by the IRDAI in this regard;
(h) 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;
(i) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ; and
(j) With respect to the other matters to be included in the Auditorsâ 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:
a) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer schedule 16 note 3.45 to the financial statements;
b) The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivatives contracts - Refer schedule 16 note 3.46 to the financial statements; and
c) There has been no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company; and
d) The disclosure requirement as envisaged in Notification G.S.R 308(E) dated March 30, 2017 is not applicable to the Company.
TO THE INDEPENDENT AUDITORSâ REPORT OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF ICICI PRUDENTIAL LIFE INSURANCE COMPANY LIMITED
Independent Auditorsâ Report on the Internal Financial Controls under clause (i) of sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
To the Members of
ICICI Prudential Life Insurance Company Limited
We have audited the internal financial controls over financial reporting of ICICI Prudential Life Insurance Company Limited (the âCompanyâ) as of March 31, 2018 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
MANAGEMENTâS RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
The Companyâs 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 (the âGuidance Noteâ) issued by the Institute of Chartered Accountants of India (the âICAIâ). 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 the companyâs business, including adherence to the companyâs 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 Act.
AUDITORSâ RESPONSIBILITY
Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing as specified under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and issued by the ICAI. 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 auditorsâ 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 internal financial controls over financial reporting.
MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
A companyâs internal financial controls 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 companyâs internal financial controls 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 authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companyâs 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 controls 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 March 31, 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 issued by the ICAI.
OTHER MATTER
The actuarial valuation of liabilities for life policies in force and policies where premium is discontinued but liability exists as at March 31, 2018 has been certified by the Appointed Actuary as per the IRDA Financial Statements Regulations, and has been relied upon by us, as mentioned in âOther Matterâ of our audit report on the standalone financial statements for the year ended March 31, 2018. Accordingly, our opinion on the internal financial controls over financial reporting does not include reporting on the operating effectiveness of the managementâs internal controls over the valuation and accuracy of the aforesaid actuarial valuation. Our opinion is not modified in respect of the above matter.
For B S R & Co. LLP For Walker Chandiok & Co LLP
Chartered Accountants Chartered Accountants
ICAI Firm Registration No. 101248W/W-100022 ICAI Firm Registration No: 001076N/N500013
Venkataramanan Vishwanath per Khushroo B. Panthaky
Partner Partner
Membership No. 113156 Membership No. 42423
Place: Mumbai Place : Mumbai
Date: April 24, 2018 Date : April 24, 2018
Mar 31, 2017
To the Members of
ICICI Prudential Life Insurance Company Limited
REPORT ON THE STANDALONE FINANCIAL STATEMENTS
We have audited the accompanying standalone financial statements of ICICI Prudential Life Insurance Company Limited (the âCompany"), which comprise the Balance Sheet as at March 31,2017, the related Revenue Account (also called the "Policyholdersâ Account" or the "Technical Account"), the Profit and Loss Account (also called the "Shareholdersâ Account" or the "Non-Technical Account")and the Receipts and Payments Account for the year then ended and a summary of significant accounting policies and other explanatory information.
MANAGEMENT''S RESPONSIBILITY FOR THE STANDALONE FINANCIAL STATEMENTS
The Companyâs 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 standalone financial statements that give a true and fair view of the Balance Sheet, the related Revenue account, the Profit and Loss Account and the Receipts and Payments account of the Company in accordance with the accounting principles generally accepted in India, including the provisions of The Insurance Act, 1938 (the "Insurance Act") (amended by the Insurance Laws (Amendment) Act, 2015), the Insurance Regulatory and Development Authority Act, 1999 (the "IRDA Act"), the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditorsâ Report of Insurance Companies) Regulations, 2002 (the "IRDA Financial Statements Regulations") and orders/directions/ circulars issued by the Insurance Regulatory and Development Authority of India ("lRDAI"/ "Authority") in this regard, and Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safe guarding 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 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 statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
AUDITORS'' REASONABILITY
Our responsibility is to express an opinion on these standalone financial statements based on our audit. We have taken into account the provisions of the Act, the Insurance Act, the IRDA Act, the IRDA Financial Statement Regulations, orders/directions/circulars issued by the IRDAI, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and Rules made there under.
We conducted our audit 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 standalone financial statements. The procedures selected depend on the auditorsâ judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the 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 the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the standalone 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 standalone financial statements.
OPINION
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 in accordance with the Insurance Act, the IRDA Act, the IRDA Financial Statements Regulations and the Act to the extent applicable and in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India, as applicable to Insurance Companies:
(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2017;
(b) in the case of Revenue Account, of the net surplus for the year ended on that date;
(c) in the case of Profit and Loss Account, of the profit for the year ended on that date; and
(d) in the case of the Receipts and Payments Account, of the receipts and payments for the year ended on that date.
OTHER MATTERS
1. The actuarial valuation of liabilities for life policies in force is the responsibility of the Companyâs Appointed Actuary (the "Appointed Actuary"). The actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at March 31,2017 has been duly certified by the Appointed Actuary and in her opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the IRDAI and the Institute of Actuaries of India in concurrence with the Authority. We have relied upon the Appointed Actuaryâs certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists, as contained in the standalone financial statements of the Company.
2. The standalone financial statements of the Company for the year ended March 31, 2016 were audited by the joint auditors of the Company, of which only one auditor is a continuing auditor, who expressed an unmodified opinion on the standalone financial statements on April 26, 2016.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the IRDA Financial Statements Regulations, we have issued a separate certificate dated April 24, 2017 certifying the matters specified in paragraphs 3 and 4 of Schedule C to the IRDA Financial Statements Regulations.
2. As required by the IRDA Financial Statements Regulations, read with 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 and have found them to be satisfactory;
(b) In our opinion and to the best of our information and according to the explanations given to us, 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) As the Companyâs financial accounting system is centralized, no returns for the purposes of our audit are prepared at the branches of the Company;
(d) The Balance Sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account dealt with by this Report are in agreement with the books of account;
(e) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 and with the accounting principles as prescribed in the IRDA Financial Statements Regulations and orders / directions / circulars issued by IRDAI in this regard;
(f) In our opinion and to the best of our information and according to the explanations given to us, investments have been valued in accordance with the provisions of the Insurance Act, the Regulations and / or orders / directions / circulars issued by IRDAI in this regard;
(g) On the basis of written representations received from the Directors of the Company, as on March 31, 2017 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2017 from being appointed as a Director in terms of Section 164 (2) of the Act;
(h) 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 "Annexure A" to this report. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial reporting;
(i) With respect to the other matters to be included in the Auditorsâ 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:
a) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer schedule 16 note 3.44 to the financial statements;
b) The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivatives contracts - Refer schedule 16 note 3.45 to the financial statements;
c) There has been no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company; and
d) The disclosure requirement as envisaged in Notification G.S.R 308(E) dated March 30, 2017 is not applicable to the Company - Refer schedule 16 note 3.48 to the financial statements.
To the Members of
ICICI Prudential Life Insurance Company Limited
We have audited the internal financial controls over financial reporting of ICICI Prudential Life Insurance Company Limited (the "Company") as of March 31, 2017 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
MANAGEMENT''S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
The Companyâs 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 (the "Guidance Note")issued by the Institute of Chartered Accountants of lndia(the "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 the companyâs business, including adherence to the Companyâs 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 Act.
AUDITORS'' RESPONSIBILITY
Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing as specified under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and issued by the ICAI. 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 auditorâs 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 internal financial controls over financial reporting.
MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
A companyâs internal financial controls 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 companyâs internal financial controls 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 companyâs 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 controls 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 March 31, 2017, 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 issued by the ICAI.
OTHER MATTER
The actuarial valuation of liabilities for life policies in force and policies where premium is discontinued but liability exists as at March 31, 2017 has been certified by the Appointed Actuary as per the regulations, and has been relied upon by us, as mentioned in para "Other Matter" of our audit report on the financial statements for the year ended March 31, 2017. Accordingly, our opinion on the internal financial controls over financial reporting does not include reporting on the operating effectiveness of the managementâs internal controls over the valuation and accuracy of the aforesaid actuarial valuation. Our opinion is not modified in respect of the above matter.
For B S R & Co. LLP For Walker Chandiok & Co LLP
Chartered Accountants Chartered Accountants
ICAI Firm Registration No: 101248W/W-100022 ICAI Firm Registration No: 001076N/N500013
Venkataramanan Vishwanath per Sudhir N. Pillai
Partner Partner
Membership No: 113156 Membership No: 105782
Place : Mumbai Place : Mumbai
Date: April 25, 2017 Date : April 25, 2017
Mar 31, 2016
To the Members of
ICICI Prudential Life Insurance Company Limited
REPORT ON THE STANDALONE FINANCIAL STATEMENTS
We have audited the accompanying standalone financial statements of ICICI Prudential Life Insurance Company Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2016, the related Revenue Account (also called the "Policyholders'' Account" or the "Technical Account"), the Profit and Loss Account (also called the "Shareholders'' Account" or "Non-Technical Account") and the Receipts and Payments Account for the year then ended, and a summary of significant accounting policies and other explanatory information.
MANAGEMENT''S RESPONSIBILITY FOR THE STANDALONE 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 standalone financial statements that give a true and fair view of the Balance Sheet, the related Revenue Account, the Profit and Loss Account and the Receipts and Payments Account of the Company in accordance with accounting principles generally accepted in India, including the provisions of The Insurance Act, 1938 (the "Insurance Act") (amended by the Insurance Laws (Amendment) Act, 2015), the Insurance Regulatory and Development Authority Act, 1999 (the "IRDA Act"), the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditor''s Report of Insurance Companies) Regulations, 2002 (the "IRDA Financial Statements Regulations"), orders/directions issued by the Insurance Regulatory and Development Authority of India (the "IRDAI" / "Authority") in this regard, and the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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 controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
AUDITORS'' RESPONSIBILITY
Our responsibility is to express an opinion on these standalone 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 Rules made thereunder.
We conducted our audit 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 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 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 the 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 standalone 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 standalone financial statements.
OPINION
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 in accordance with the Insurance Act, the IRDA Act, the IRDA Financial Statements Regulations and the Act to the extent applicable and in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India, as applicable to Insurance Companies:
(a) i n the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2016;
(b) i n the case of Revenue Account, of the net surplus for the year ended on that date;
(c) i n the case of Profit and Loss Account, of the profit for the year ended on that date; and
(d) i n the case of the Receipts and Payments Account, of the receipts and payments for the year ended on that date.
OTHER MATTER
The actuarial valuation of liabilities for life policies in force is the responsibility of the Company''s Appointed Actuary (the "Appointed Actuary"). The actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at March 31, 2016 has been duly certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the Insurance Regulatory Development Authority of India ("IRDAI" / "Authority") and the Institute of Actuaries of India in concurrence with the Authority. We have relied upon Appointed Actuary''s certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists on standalone financial statements of the Company.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the IRDAI Financial Statements Regulations, we have issued a separate certificate dated April 26, 2016 certifying the matters specified in paragraphs 3 and 4 of Schedule C to the IRDA Financial Statements Regulations.
2. As required by the IRDAI Financial Statements Regulations, read with 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;
(b) In our opinion and to the best of our information and according to the explanations given to us, 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, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account dealt with by this Report are in agreement with the books of account;
(d) I n our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 and with the accounting principles as prescribed in the IRDAI Financial Statements Regulations and orders / directions issued by IRDAI in this regard;
(e) In our opinion and to the best of our information and according to the explanations given to us, investments have been valued in accordance with the provisions of the Insurance Act, the Regulations and / or orders / directions issued by IRDAI in this regard;
(f) On the basis of written representations received from the Directors of the Company, as on March 31, 2016 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2016 from being appointed as a Director in terms of Section 164 (2) of the Act.
(g) 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 "Annexure A" to this report;
(h) 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 financial statements - Refer schedule 16 note 3.43 to the financial statements;
ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivatives contracts -- Refer schedule 16 note 3.44 to the financial statements;
iii. There has been no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.
We have audited the internal financial controls over financial reporting of ICICI Prudential Life Insurance Company Limited ("the Company") as of March 31, 2016 in conjunction with our audit of the standalone financial statements of the Company for the year 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. 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 the 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 as specified 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 internal financial controls system over financial reporting.
MEANING OF INTERNAL FINANCIAL CONTROLS OVER 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 authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised 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 March 31, 2016, 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.
OTHER MATTER
We report that the actuarial valuation of liabilities for life policies in force and policies where premium is discontinued but liability exists as at March 31, 2016 has been certified by the Appointed Actuary as per the regulations, and has been relied upon by us as mentioned in para other matters of our audit report on the financial statements for the year ended March 31, 2016. Our opinion is not modified in respect of above matter.
For and on behalf of the Board
Date : April 26, 2016 Chanda Kochhar
Place : Mumbai Chairperson
Mar 31, 2015
To the Members of
ICICI Prudential Life Insurance Company Limited
REPORT ON THE STANDALONE FINANCIAL STATEMENTS
We have audited the accompanying standalone financial statements of ICICI Prudential Life Insurance Company Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2015, the related Revenue Account (also called the "Policyholders'' Account" or the "Technical Account"), the Profit and Loss Account (also called the "Shareholders'' Account" or "Non-Technical Account") and the Receipts and Payments Account for the year then ended, and a summary of significant accounting policies and other explanatory information.
MANAGEMENT''S RESPONSIBILITY FOR THE STANDALONE 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 standalone financial statements that give a true and fair view of the Balance Sheet, the related Revenue Account, the Profit and Loss Account and the Receipts and Payments Account of the Company in accordance with accounting principles generally accepted in India, including the provisions of the Insurance Act, 1938 (the "Insurance Act") (amended by the Insurance Laws (Amendment) Act, 2015), the Insurance Regulatory and Development Authority Act, 1999 (the "IRDA Act"), the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditor''s Report of Insurance Companies) Regulations, 2002 (the "IRDA Financial Statements Regulations"), orders/ directions/circulars issued by the Insurance Regulatory and Development Authority of India (the "IRDAI") in this regard, and the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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, the relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
AUDITORS'' RESPONSIBILITY
Our responsibility is to express an opinion on these 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 Rules made there under.
We conducted our audit in accordance with the Standards on Auditing 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 financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such internal controls. An audit also includes evaluating the appropriateness of the 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 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 Standalone financial statements.
OPINION
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 in accordance the Insurance Act, the IRDA Act, the IRDA Financial Statements Regulations and the Act to the extent applicable and in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India, as applicable to Insurance Companies:
(a) i n the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2015;
(b) in the case of Revenue Account, of the net surplus for the year ended on that date;
(c) in the case of Profit and Loss Account, of the profit for the year ended on that date; and
(d) i n the case of the Receipts and Payments Account, of the receipts and payments for the year ended on that date.
OTHER MATTER
The actuarial valuation of liabilities for life policies in force is the responsibility of the Company''s Appointed Actuary (the "Appointed Actuary"). The actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at March 31, 2015 has been duly certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the Insurance Regulatory Development Authority of India ("IRDAI" / "Authority") and the Institute of Actuaries of India in concurrence with the Authority. We have relied upon Appointed Actuary''s certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists on standalone financial statements of the Company.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the IRDA Financial Statements Regulations, we have issued a separate certificate dated April 24, 2015 certifying the matters specified in paragraphs 3 and 4 of Schedule C to the IRDA Financial Statements Regulations.
2. As required by the IRDA Financial Statements Regulations, read with 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 the audit;
(b) I n our opinion and to the best of our information and according to the explanations given to us, 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, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account dealt with by this Report are in agreement with the books of account;
(d) I n our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 and with the accounting principles as prescribed in the IRDA Financial Statements Regulations and orders / directions issued by IRDAI in this regard;
(e) I n our opinion and to the best of our information and according to the explanations given to us, investments have been valued in accordance with the provisions of the Insurance Act, the Regulations and / or orders / directions issued by IRDAI in this regard;
(f) On the basis of written representations received from the Directors of the Company, as on March 31, 2015 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2015 from being appointed as a Director in terms of Section 164 (2) of the Act.
(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 financial statements - Refer schedule 16 note 3.43 to the financial statements;
ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivatives contracts - Refer schedule 16 note 3.44 to the financial statements;
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.
This certificate is issued to comply with the provisions of paragraphs 3 and 4 of Schedule C of the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditor''s Report of Insurance Companies) Regulations 2002, (the "Regulations") read with regulation 3 of the Regulations.
Management of the Company is responsible for complying with the provisions of The Insurance Act, 1938 (the "Insurance Act"), the Insurance Regulatory and Development Authority Act, 1999 (the "IRDA Act"), the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditor''s Report of Insurance Companies) Regulations, 2002 (the "IRDA Financial Statements Regulations"), orders/directions issued by the Insurance Regulatory and Development Authority of India (the "IRDAI") which includes the preparation of the Management Report. This includes collecting, collating and validating data and designing, implementing and monitoring of internal controls suitable for ensuring compliance as aforesaid.
Our responsibility, for the purpose of this certificate, is limited to certifying matters contained in paragraphs 3 and 4 of Schedule C of the Regulations. We conducted our examination in accordance with the Guidance Note on Audit Reports and Certificates for Special Purposes issued by the Institute of Chartered Accountants of India (the ''ICAI'').
In accordance with the information and explanations given to us and to the best of our knowledge and belief and based on our examination of the books of account and other records maintained by ICICI Prudential Life
Insurance Company Limited (''the Company'') for the year ended March 31, 2015, we certify that:
1. We have reviewed the Management Report attached to the financial statements for the year ended March 31, 2015, and on the basis of our review, there is no apparent mistake or material inconsistencies with the financial statements;
2. Based on management representations and compliance certificates submitted to the Board of Directors by the officers of the Company charged with compliance and the same being noted by the Board, we certify that the Company has complied with the terms and conditions of registration stipulated by Insurance Regulatory and Development Authority of India (IRDAI);
3. We have verified the cash balances, to the extent considered necessary, and securities relating to the Company''s loans and investments as at March 31, 2015, by actual inspection or on the basis of certificates / confirmations received from the Custodian and/ or Depository Participants appointed by the Company, as the case may be. As at March 31, 2015, the Company does not have reversions and life interests;
4. The Company is not a trustee of any trust; and
5. No part of the assets of the Policyholders'' Funds has been directly or indirectly applied in contravention to the provisions of the Insurance Act, 1938, relating to the application and investments of the Policyholders'' Funds.
1. Includes '' 1 10,798 thousands (Market value: '' 106,124 thousands) of securities under Section 7 of Insurance Act, 1938 at March 31, 2015. [At March 31, 2014: '' 102,361 thousands (Market value: '' 102,189 thousands)] - Refer 3.25 of Schedule 16
2. Government securities of '' 953,061 thousands with market value of '' 1,037,600 thousands at March 31, 2015 (at March 31, 2014: '' Nil with market value of '' Nil) has been deposited with Clearing Corporation of India Limited (CCIL) as Settlement Guarantee Fund (SGF) deposit. - Refer 3.25 of Schedule 16
3. Includes Fixed deposit of '' 1,050,200 thousands at March 31, 2015 [At March 31, 2014: '' 1,050,200 thousands] and '' 299,000 thousands at March 31, 2015 [At March 31,2014: '' 300,100 thousands] deposited with National Securities Clearing Corporation Limited and Indian Clearing Corporation Limited respectively towards margin requirement for equity trade settlement - Refer 3.25 of Schedule 16
4. Aggregate amount of Company''s investments and the market value thereof:
5. Investments in subsidiary at cost is '' 270,000 thousands at March 31, 2015 [At March 31, 2014 : '' 270,000 thousands]. For Investments in holding company and other related entities refer note 3.9 of schedule 16.
6. Investments made out of Catastrophe reserve is '' Nil.(at March 31, 2015 and at March 31, 2014)
7. Debt Securities are held to maturity and reduction in market values represent market conditions and not a permanent diminution in value of investments, if any.
Note: Refer schedule 16 note 2.11 for accounting policy related to investments
1. Government securities of '' 475,846 thousands with market value of '' 518,800 thousands (at March 31, 2014: '' 1,321,747 thousands with market value of '' 1,227,178 thousands) has been deposited with Clearing Corporation of India Limited (CCIL) as Settlement Guarantee Fund (SGF) deposit. Government securities of '' 207,080 thousands with market value of '' 209,850 thousands (at March 31, 2014: '' 207,303 thousands with market value of '' 185,182 thousands) has been deposited with CCIL for trades in the Collateralized borrowing and lending obligation segment - Refer 3\.25 of Schedule 16
2. Aggregate amount of Company''s investments and the market value thereof:
3. For Investments in holding company and other related entities - Refer note 3.9 of schedule 16.
4. Investments made out of Catastrophe reserve is '' Nil.(at March 31, 2015 and at March 31, 2014)
5. Debt Securities are held to maturity and reduction in market values represent market conditions and not a permanent diminution in value of investments, if any. Note: Refer schedule 16 note 2.11 for accounting policy related to investments
1. Government securities of '' 475,846 thousands with market value of '' 518,800 thousands (at March 31, 2014: '' 1,321,747 thousands with market value of '' 1,227,178 thousands) has been deposited with Clearing Corporation of India Limited (CCIL) as Settlement Guarantee Fund (SGF) deposit. Government securities of '' 207,080 thousands with market value of '' 209,850 thousands (at March 31, 2014: '' 207,303 thousands with market value of '' 185,182 thousands) has been deposited with CCIL for trades in the Collateralized borrowing and lending obligation segment - Refer 3.25 of Schedule 16
3. For Investments in holding company and other related entities - Refer note 3.9 of schedule 16.
4. Investments made out of Catastrophe reserve is '' Nil.(at March 31, 2015 and at March 31, 2014)
5. Debt Securities are held to maturity and reduction in market values represent market conditions and not a permanent diminution in value of investments, if any. Note: Refer schedule 16 note 2.11 for accounting policy related to investments
For and on behalf of the Board
Chanda Kochhar
Date: April 24, 2015 Chairperson
Place: Mumbai DIN-00043617
Mar 31, 2014
To the Members of
ICICI Prudential Life Insurance Company Limited
REPORT ON THE FINANCIAL STATEMENTS
We have audited the accompanying financial statements of ICICI Prudential Life Insurance Company Limited (the "Company") which comprise the Balance Sheet as at March 31, 2014, the related Revenue Account (also called the "Policyholders'' Account" or the "Technical Account"), the Profit and Loss Account (also called the "Shareholders'' Account" or "Nontechnical Account") and the Receipts and Payments Account for the year then ended, and a summary of significant accounting policies and other explanatory information.
MANAGEMENT''S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
Management is responsible for the preparation of these financial statements that give a true and fair view of the Balance Sheet, the related Revenue Account, the Profit and Loss Account and the Receipts and Payments Account of the Company in accordance with accounting principles generally accepted in India, including the provisions of The Insurance Act, 1938 (the "Insurance Act"), the Insurance Regulatory and Development Authority Act, 1999 (the "IRDA Act"), the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditor''s Report of Insurance Companies) Regulations, 2002 (the "IRDA Financial Statements Regulations"), orders/directions issued by the Insurance Regulatory and Development Authority (the "IRDA") in this regard, and the Accounting Standards notified under the Companies Act, 1956 read with the General Circular 15/2013 dated September 13, 2013, of the Ministry of Corporate Affairs, in respect of Section 133 of the Companies Act, 2013, to the extent applicable. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
AUDITORS'' RESPONSIBILITY
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. 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 financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
OPINION
In our opinion and to the best of our information and according to the explanations given to us, the financial statements are prepared in accordance with the requirements of the Insurance Act, the IRDA Act, the IRDA Financial Statements Regulations and the Companies Act, 1956 to the extent applicable and in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India, as applicable to Insurance Companies:
(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;
(b) in the case of Revenue Account, of the net surplus for the year ended on that date;
(c) in the case of Profit and Loss Account, of the profit for the year ended on that date; and
(d) in the case of the Receipts and Payments Account, of the receipts and payments for the year ended on that date.
OTHER MATTER
The actuarial valuation of liabilities for life policies in force is the responsibility of the Company''s Appointed Actuary (the "Appointed Actuary"). The actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at March 31, 2014 has been duly certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the Insurance Regulatory Development Authority ("IRDA"/"Authority") and the Institute of Actuaries of India in concurrence with the Authority. We have relied upon Appointed Actuary''s certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists on financial statements of the Company.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the IRDA Financial Statements Regulations, we have issued a separate certificate dated April 22, 2014 certifying the matters specified in paragraphs 3 and 4 of Schedule C to the IRDA Financial Statements Regulations.
2. As required by the IRDA Financial Statements Regulations, read with section 227(3) of the Companies Act, 1956, we report that:
(a) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of the audit and have found them to be satisfactory;
(b) In our opinion and to the best of our information and according to the explanations given to us, proper books of account as required by law have been maintained by the Company, so far as appears from our examination of those books;
(c) As the Company''s financial accounting system is centralized, no returns for the purposes of our audit are prepared at the branches of the Company;
(d) The Balance Sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account referred to in this report are in agreement with the books of account;
(e) The Balance sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account dealt with by this report comply with the Accounting Standards notified under the Companies Act, 1956 and the Rules framed there under read with the General Circular 15/2013 dated September 13, 2013, of the Ministry of Corporate Affairs, in respect of Section 133 of the Companies Act, 2013 to the extent they are not inconsistent with the accounting principles prescribed in the Regulations and orders/directions issued by IRDA in this regard;
(f) In our opinion and to the best of our information and according to the explanations given to us, investments have been valued in accordance with the provisions of the Insurance Act, the Regulations and/or orders/directions issued by IRDA in this regard;
(g) The accounting policies selected by the Company are appropriate and are in compliance with the applicable Accounting Standards notified under the Companies Act, 1956 and the Rules framed there under read with the General Circular 15/2013 dated September 13, 2013, of the Ministry of Corporate Affairs, in respect of Section 133 of the Companies Act, 2013 and with the accounting principles as prescribed in the IRDA Financial Statements Regulations and orders/ directions issued by IRDA in this regard; and
(h) On the basis of written representations received from the Directors of the Company, as on March 31, 2014 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2014 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.
This certificate is issued to comply with the provisions of paragraphs 3 and 4 of Schedule C of the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditor''s Report of Insurance Companies) Regulations 2002, (the "Regulations") read with regulation 3 of the Regulations.
Management of the Company is responsible for complying with the provisions of The Insurance Act, 1938 (the "Insurance Act"), the Insurance Regulatory and Development Authority Act, 1999 (the "IRDA Act"), the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditor''s Report of Insurance Companies) Regulations, 2002 (the "IRDA Financial Statements Regulations"), orders/directions issued by the Insurance Regulatory and Development Authority (the "IRDA") which includes the preparation of the Management Report. This includes collecting, collating and validating data and designing, implementing and monitoring of internal controls suitable for ensuring compliance as aforesaid.
Our responsibility, for the purpose of this certificate, is limited to certifying matters contained in paragraphs 3 and 4 of Schedule C of the Regulations. We conducted our examination in accordance with the Guidance Note on Audit Reports and Certificates for Special Purposes issued by the Institute of Chartered Accountants of India (the ''ICAI'').
In accordance with the information and explanations given to us and to the best of our knowledge and belief and based on our examination of the books of account and other records maintained by ICICI Prudential Life Insurance Company Limited (''the Company'') for the year ended March 31, 2014, we certify that:
1. We have reviewed the Management Report attached to the financial statements for the year ended March 31, 2014, and on the basis of our review, there is no apparent mistake or material inconsistencies with the financial statements;
2. Based on management representations and compliance certificates submitted to the Board of Directors by the officers of the Company charged with compliance and the same being noted by the Board, we certify that the Company has complied with the terms and conditions of registration stipulated by Insurance Regulatory and Development Authority (IRDA);
3. We have verified the cash balances, to the extent considered necessary, and securities relating to the Company''s loans and investments as at March 31, 2014, by actual inspection or on the basis of certificates/confirmations received from the Custodian and/ or Depository Participants appointed by the Company, as the case may be. As at March 31, 2014, the Company does not have reversions and life interests;
4. The Company is not a trustee of any trust; and
5. No part of the assets of the Policyholders'' Funds has been directly or indirectly applied in contravention to the provisions of the Insurance Act, 1938, relating to the application and investments of the Policyholders'' Funds.
For S. R. BATLIBOI & CO. LLP For S. B. Billimoria & Co.
Chartered Accountants Chartered Accountants
ICAI Firm Registration No: 301003E ICAI Firm Registration No: 101496W
per Shrawan Jalan Sanjiv V. Pilgaonkar
Partner Partner
Membership No: 102102 Membership No: 39826
Place : Mumbai Place : Mumbai
Date : April 22, 2014 Date : April 22, 2014
Mar 31, 2013
To the Members of
ICICI Prudential Life Insurance Company Limited
REPORT ON THE FINANCIAL STATEMENTS
We have audited the accompanying financial statements of ICICI Prudential Life Insurance Company Limited (the "Company") which comprise the Balance Sheet as at March 31, 2013, the related Revenue Account (also called the "Policyholders'' Account" or the "Technical Account"), the Profit and Loss Account (also called the "Shareholders'' Account" or "Non-Technical Account") and the Receipts and Payments Account for the year then ended, and a summary of significant accounting policies and other explanatory information.
MANAGEMENT''S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
Management is responsible for the preparation of these financial statements that give a true and fair view of the Balance Sheet, the related Revenue Account, the Profit and Loss Account and the Receipts and Payments Account of the Company in accordance with accounting principles generally accepted in India, including the provisions of the Insurance Act, 1938 (the "Insurance Act"), the Insurance Regulatory and Development Authority Act, 1999 (the "IRDA Act"), the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditor''s Report of Insurance Companies) Regulations, 2002 (the "IRDA Financial Statements Regulations"), orders/directions issued by the Insurance Regulatory and Development Authority (the "IRDA") in this regard , read with Section 211(3C) of the Companies Act, 1956, to the extent applicable. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
AUDITORS'' RESPONSIBILITY
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. 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 financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements 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 management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
OPINION
In our opinion and to the best of our information and according to the explanations given to us, the financial statements are prepared in accordance with the requirements of the Insurance Act, the IRDA Act, the IRDA Financial Statements Regulations and the Companies Act, 1956 to the extent applicable and in the manner so required, and give a true and fair view in conformity with the accounting principles generally accepted in India, as applicable to Insurance Companies:
(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2013;
(b) in the case of Revenue Account, of the net surplus for the year ended on that date;
(c) in the case of Profit and Loss Account, of the profit for the year ended on that date; and
(d) in the case of the Receipts and Payments Account, of the receipts and payments for the year ended on that date.
OTHER MATTER
The actuarial valuation of liabilities for life policies in force is the responsibility of the Company''s Appointed Actuary (the "Appointed Actuary"). The actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at March 31, 2013 has been duly certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the Insurance Regulatory Development Authority ("IRDA" / "Authority") and the Actuarial Society of India in concurrence with the Authority. We have relied upon Appointed Actuary''s certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists on financial statements of the Company.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the IRDA Financial Statements Regulations, we have issued a separate certificate dated April 18, 2013 certifying the matters specified in paragraphs 3 and 4 of Schedule C to the IRDA Financial Statements Regulations.
2. As required by the IRDA Financial Statements Regulations, read with section 227(3) of the Companies Act, 1956, we report that:
(a) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of the audit and have found them to be satisfactory;
(b) In our opinion and to the best of our information and according to the explanations given to us, proper books of account as required by law have been maintained by the Company, so far as appears from our examination of those books;
(c) As the Company''s financial accounting system is centralised, no returns for the purposes of our audit are prepared at the branches of the Company;
(d) The Balance Sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account referred to in this report are in agreement with the books of account;
(e) The Balance sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 and the Rules framed there under to the extent they are not inconsistent with the accounting principles prescribed in the Regulations and orders / directions issued by IRDA in this regard:
(f) In our opinion and to the best of our information and according to the explanations given to us, investments have been valued in accordance with the provisions of the Insurance Act, the Regulations and / or orders / directions issued by IRDA in this regard;
(g) The accounting policies selected by the Company are appropriate and are in compliance with the applicable Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 and the Rules framed there under and with the accounting principles as prescribed in the IRDA Financial Statements Regulations and orders / directions issued by IRDA in this regard; and
(h) On the basis of written representations received from the Directors of the Company, as on March 31, 2013 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2013 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.
For S. R. Batliboi & CO. LLP For S. B. Billimoria & Co.
Chartered Accountants Chartered Accountants
ICAI Firm Registration No: 301003E ICAI Firm Registration No: 101496W
per Shrawan Jalan Sanjiv V. Pilgaonkar
Partner Partner
Membership No: 102102 Membership No: 39826
Place : Mumbai Place : Mumbai
Date : April 18, 2013 Date : April 18, 2013
Mar 31, 2012
To the Members of
ICICI Prudential Life Insurance Company Limited
1. We have audited the attached Balance Sheet of ICICI Prudential Life Insurance Company Limited (âthe Company'') as at March 31, 2012, the related Revenue Account, the Profit and Loss Account and the Receipts and Payments Account for the year ended on that date annexed thereto, which we have signed under reference to this report. These financial statements are the responsibility of the Company''s management. Our responsibility is to express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
3. Without qualifying our opinion, we draw your attention to Note no. 3.15 of schedule 16 to the financial statements. In view of the reasons stated in the said note, no adjustments on account of the tax proposals applicable to insurance companies as contained in the Finance Bill 2012 have been made to the carrying value of deferred tax asset of '' 860,260 thousand of the Company as at March 31, 2012.
4. Further to our comments made above, we report that:
(a)We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of the audit and have found them to be satisfactory;
(b) As the Company''s financial accounting system is centralised, no returns for the purposes of our audit are prepared at the branches of the Company;
(c) The Balance Sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account referred to in this report are in agreement with the books of account;
(d) The actuarial valuation of liabilities for life policies in force is the responsibility of the Company''s Appointed Actuary (âthe Appointed Actuary''). The actuarial valuation of these liabilities as at March 31, 2012 has been duly certified by the Appointed Actuary and in his opinion the assumptions for such valuation are in accordance with the guidelines and norms issued by the Insurance Regulatory Development Authority (âIRDA'') (âAuthority'') and the Actuarial Society of India in concurrence with the Authority. We have relied upon Appointed Actuary''s certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists on financial statements of the Company;
(e) On the basis of written representations received from the Directors of the Company, as on March 31, 2012 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2012 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.
5. In our opinion and to the best of our information and according to the explanations given to us, we further report that:
(a) Proper books of account as required by law have been maintained by the Company, so far as appears from our examination of those books;
(b) The Investments have been valued in accordance with the provisions of the Insurance Act, 1938, the Regulations and/or orders/directions issued by IRDA in this regard;
(c) The accounting policies selected by the Company are appropriate and are in compliance with the applicable Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956 and the Rules framed there under and with the accounting principles as prescribed in the Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditor''s Report of Insurance Companies) Regulations, 2002, (âthe Regulations'') and orders/directions issued by IRDA in this regard;
(d) The Balance sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Accounts dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 and the Rules framed there under to the extent they are not inconsistent with the accounting principles prescribed in the Regulations and orders/directions issued by IRDA in this regard;
(e) The Balance Sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account together with the notes thereon and attached thereto are prepared in accordance with the requirements of the Regulations, the Insurance Act, 1938, the Insurance Regulatory and Development Authority Act, 1999 and the Companies Act, 1956, to the extent applicable and in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:
i. in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2012;
ii. in the case of Revenue Account, of the net surplus for the year ended on that date;
iii. in the case of Profit and Loss account, of the profit for the year ended on that date; and
iv. in the case of the Receipts and Payments Account, of the receipts and payments for the year ended on that date.
For S. R. Batliboi & Co. For B S R & Co.
Chartered Accountants Chartered Accountants
Firm''s Registration No: 301003E Firm''s Registration No: 101248W
per Shrawan Jalan N Sampath Ganesh
Partner Partner
Membership No: 102102 Membership No: 042554
Mumbai Mumbai
April 25, 2012 April 25, 2012
Mar 31, 2011
To the Members of
ICICI Prudential Life Insurance Company Limited
1 We have audited the attached Balance Sheet of ICICI Prudential Life Insurance Company Limited (''the Company'') as at March 31, 2011, the related Revenue Account, the Profit and Loss Account and the Receipts and Payments Account for the year ended on that date annexed thereto, which we have signed under reference to this report. These financial statements are the responsibility of the Company''s management. Our responsibility is to express an opinion on these financial statements based on our audit.
2 We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
3 We report that:
(a) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of the audit and have found them to be satisfactory;
(b) In our opinion and to the best of our information and according to the explanations given to us, proper books of account as required by law have been maintained by the Company, so far as appears from our examination of those books;
(c) As the Company''s financial accounting system is centralised, no returns for the purposes of our audit are prepared at the branches of the Company;
(d) The Balance Sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account referred to in this report are in agreement with the books of account;
(e) The actuarial valuation of liabilities for life policies in force is the responsibility of the Company''s Appointed Actuary (''the Appointed Actuary''). The actuarial valuation of these liabilities as at March 31, 2011 has been duly certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the Insurance Regulatory Development Authority (''IRDA'') (''Authority'') and the Actuarial Society of India in concurrence with the Authority. We have relied upon Appointed Actuary''s certificate in this regard for forming our opinion on the financial statements of the Company;
(f) On the basis of written representations received from the Directors of the Company, as on March 31, 2011 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2011 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.
4 In our opinion and to the best of our information and according to the explanations given to us, we further report that:
(a) The Investments have been valued in accordance with the provisions of the Insurance Act, 1938, the Insurance Regulatory Development Authority (Preparation of Financial Statements and Auditor''s Report of Insurance Companies) Regulations, 2002 (''the Regulations'') and orders / directions issued by IRDA in this regard;
(b) The accounting policies selected by the Company are appropriate and are in compliance with the applicable Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 and the Rules framed there under and with the accounting principles as prescribed in the Regulations and orders / directions issued by IRDA in this regard;
(c) The Balance sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Accounts dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 and the Rules framed there under to the extent they are not inconsistent with the accounting principles prescribed in the Regulations and orders / directions issued by IRDA in this regard;
(d) The Balance Sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account together with the notes thereon and attached thereto are prepared in accordance with the requirements of the Regulations, the Insurance Act, 1938, the Insurance Regulatory and Development Authority Act, 1999 and the Companies Act, 1956, to the extent applicable and in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:
i. in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2011;
ii. in the case of Revenue Account, of the net surplus for the year ended on that date;
iii. in the case of Profit and Loss account, of the profit for the year ended on that date; and
iv. in the case of the Receipts and Payments Account, of the receipts and payments for the year ended on that date.
5 Further, on the basis of our examination of books and records of the Company and according to the information and explanations given to us, we certify to the best of our knowledge and belief that:
(a) We have reviewed the Management Report attached to the financial statements for the year ended March 31, 2011, and have found no apparent mistake or material inconsistencies with the financial statements; and
(b) Based on management representations and compliance certificates noted by the Board Audit Committee, nothing has come to our attention which causes us to believe that the Company has not complied with the terms and conditions of registration stipulated by IRDA.
For Walker, Chandiok & Co For B S R & Co.
Chartered Accountants Chartered Accountants
per Khushroo B. Panthaky Akeel Master
Partner Partner
Membership No: F-42423 Membership No: 046768
Mumbai, April 21, 2011 Mumbai, April 21, 2011
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