Following is the extract from the Balance Sheet of Rain Pvt. Ltd.: (i) Borrowings as on 31/03/2025:10 Cr. (ii) Fresh borrowings from bank during the…

Audit procedures performed to ensure that all borrowings reflected in the balance sheet are valid claims owed to bank or third parties are as under: (i) Review board minutes for approval of new lending agreements. During review, ensure that new loan agreements or bond issuances were authorized. Ensure that significant debt commitments were approved by the board of directors. (ii) Agree details of loans recorded (interest rate, nature and repayment terms) to the loan agreement. Verify that borrowing limits, if any, imposed by agreements are not exceeded. (iii) Roll out and obtain independent balance confirmations (SA 505) in respect of all the borrowings from the lender (banks/ financial institutions etc.). (iv) Agree details of leases and hire purchase creditors recorded to underlying contracts/agreements. (v) In case of Debentures, examine trust deed for terms and dates of redemption, borrowing restrictions and compliance with covenants. (vi) When debt is retired, ensure that a discharge is received on assets securing the debt. (vii) Obtain Written Representation that all the liabilities which have been recorded represent a valid claim by the lenders. (viii) Auditor will ensure parri passu charge has been created on the assets of the company. (ix) Trace the fresh borrowings of 3crores and repayment of 5crores to the Company's Bank statement and Account books to confirm the movement of funds.