1. We have audited the accompanying Standalone Financial Statements of Kotak Mahindra Bank Limited (the ‘Bank’), which comprise the
Standalone Balance Sheet as at 31 March 2026, the Standalone Profit and Loss Account, and the Standalone Cash Flow Statement for the
year ended 31 March 2026, and notes to the Standalone Financial Statements including a summary of the significant accounting policies
and other explanatory information (the ‘Standalone Financial Statements’).
2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Financial
Statements give the information required by the Banking Regulation Act, 1949 and Companies Act, 2013 (the ‘Act’) and the circulars,
guidelines and directions issued by the Reserve Bank of India (the ‘RBI’) from time to time (the ‘RBI guidelines’), in the manner so required
for banking companies and give a true and fair view, in conformity with the Accounting Standards prescribed under section 133 of the Act,
read with the Companies (Accounting Standards) Rules, 2021 as applicable to banks and other accounting principles generally accepted
in India, of the state of affairs of the Bank as at 31 March 2026 and its profit and its cash flows for the year ended 31 March 2026.
BASIS FOR OPINION
3. 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 ‘Auditors’ Responsibilities for the Audit of the Standalone Financial Statements’ section
of our report. We are independent of the Bank in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India
(‘ICAI’) 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 fulfiled 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
4. 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.
5. We have determined the matters described below to be the key audit matters to be communicated in our report.
Identification of and Provisioning against Non-performing Assets (“NPAs”):
Total Loans and Advances (Net of Provision) as at March 31, 2026: H496,009.16 crore
Provision for NPAs as at March 31, 2026: H4,755.30 crore
Refer Schedule 9, Schedule 17(C)(2) and Schedule 18A, note 4(i)
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Key audit matter
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How our audit addressed the key audit matter
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The Bank is required to comply with Reserve Bank of India (“RBI”)
(Commercial Banks - Income Recognition, Asset Classification and
Provisioning) Directions, 2025 (the’ IRAC norms’) and amendments
thereto (“RBI guidelines”) which prescribes the norms for
identification and classification of Non-performing Assets (‘NPAs’)
and the minimum provision required for such assets.
The Bank is also required to apply its judgement to determine the
identification and provision required against NPAs considering
various quantitative as well as qualitative factors.
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Our audit approach included testing the design, operating
effectiveness of internal controls and substantive audit procedures
in respect of income recognition, asset classification and
provisioning pertaining to advances. In particular:
• We have evaluated and understood the Bank’s internal control
system in adhering to the RBI guidelines;
• We have analysed and understood key IT systems/ applications
used and tested the design and implementation and
operational effectiveness of relevant controls in relation to
income recognition, asset classification, viz., standard, sub¬
standard, doubtful and loss with reference to RBI guidelines
and provisioning pertaining to advances; and
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Key audit matter
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How our audit addressed the key audit matter
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As the identification of and provisioning against NPAs requires
considerable level of management estimation, application of various
regulatory requirements and its significance to the overall audit due
to stakeholder and regulatory focus, we have identified this as a key
audit matter.
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• We test checked advances to examine the validity and accuracy
of the recorded amounts, impairment provision for NPAs, and
compliance with IRAC norms of RBI guidelines.
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Information Technology (‘IT’) Systems and Controls Impacting Financial Reporting
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Key Audit Matter
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How our audit addressed the key audit matter
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As the Bank operates on core banking solution across its branches and
asset centres, the reliability and security of Information technology
(“IT”) systems plays a key role in the business operations. Since
large volume of transactions are processed daily, the IT controls are
required to ensure that applications process data as expected and
that changes are made in an appropriate manner.
IT infrastructure is critical for smooth functioning and accurate
accounting and financial reporting process.
Due to the pervasive nature and complexity of the IT environment,
we have ascertained key IT systems used in financial reporting
process and its related controls as a key audit matter.
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In assessing the controls over the IT systems of the Bank, we
involved our technology specialists to understand the IT control
environment, IT infrastructure and IT systems.
We conducted an assessment and identified key IT systems
that are critical for accounting and financial reporting process
and are relevant for our audit and tested their internal controls.
In particular:
• We obtained an understanding of the Bank’s IT control
environment and key changes during the audit period that may
be relevant to the audit;
• We tested the design, implementation and operating effectiveness
of the Bank’s General IT controls over the key IT systems that
are critical to accounting and financial reporting. This included
evaluation of Bank’s controls for user access management,
program change management, database management, network
operations, incident management and other IT operations
performed by the Bank during the period of audit;
• We tested key automated business cycle controls and system
generated reports relevant to the audit; and
• We also tested compensating controls and performed alternate
procedures to assess whether there were any unaddressed IT
risks that would materially impact the financial statements.
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INFORMATION OTHER THAN THE FINANCIAL STATEMENTS AND AUDITORS’ REPORT THEREON
6. The Bank’s Board of Directors are responsible for the other information. The other information comprises the information included in the
Annual Report but does not include the Standalone Financial Statements and our auditors’ report thereon. The Annual Report is expected
to be made available to us after the date of this auditors’ report.
Our opinion on the Standalone Financial Statements does not cover the other information and we will not express any form of assurance
conclusion thereon.
In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other information identified above
when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the Standalone
Financial Statements or knowledge obtained in the audit or otherwise appears to be materially misstated.
When we read the Annual Report, if we conclude that there is a material misstatement therein, we are required to communicate the matter
to those charged with governance and take appropriate action as applicable under the relevant laws and regulations.
RESPONSIBILITIES OF MANAGEMENT AND BOARD OF DIRECTORS’ FOR THE STANDALONE FINANCIAL STATEMENTS
7. The accompanying Standalone Financial Statements have been approved by the Bank’s Board of Directors. The Bank’s Board of Directors
are responsible for the matters stated in section 134(5) of the Act with respect to the preparation and presentation of these Standalone
Financial Statements that give a true and fair view of the financial position, financial performance and cash flows of the Bank in
accordance with the Accounting Standards specified under section 133 of the Act, read with the Companies (Accounting Standards) Rules,
2021 as applicable to banks, and other accounting principles generally accepted in India, and provisions of Section 29 of the Banking
Regulation Act, 1949 and the RBI guidelines. This responsibility also includes maintenance of adequate accounting records in accordance
with the provisions of the Act, the Banking Regulation Act, 1949 and the RBI guidelines for safeguarding of the assets of the Bank 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; selection of the appropriate accounting software for ensuring compliance with applicable
laws and regulations including those related to retention of audit logs; 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.
8. In preparing the Standalone Financial Statements, the Board of Directors are responsible for assessing the Bank’s ability to continue as
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the
Board of Directors either intend to liquidate the Bank or to cease operations, or has no realistic alternative but to do so.
9. The Board of Directors are also responsible for overseeing the Bank’s financial reporting process.
AUDITORS’ RESPONSIBILITIES FOR THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS
10. 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 auditors’ 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.
11. 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 Bank has adequate
internal financial controls with reference to Standalone 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 the management;
• Conclude on the appropriateness of the management’s 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
Bank’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention
in our auditors’ 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 auditors’ report. However,
future events or conditions may cause the Bank 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.
Materiality is the magnitude of misstatements in the Standalone Financial Statements that, individually or in aggregate, makes it probable
that the economic decisions of a reasonably knowledgeable user of the Standalone Financial Statements may be influenced. We consider
quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii)
to evaluate the effect of any identified misstatements in the Standalone Financial Statements.
12. 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.
13. 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.
14. 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 auditors’ 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
The Standalone Financial Statements of the Bank for the year ended 31 March 2025, were jointly audited by Deloitte Haskins & Sells and KKC &
Associates LLP under the Act and the Banking Regulation Act, 1949, who vide their report dated 3 May 2025, expressed an unmodified opinion
on those Standalone Financial Statements. Accordingly, M M NISSIM & CO LLP does not express any opinion on the figures reported in the
Standalone Financial Statements for the corresponding year ended 31 March 2025.
Our opinion is not modified in respect of this matter.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
15. In our opinion, the Balance Sheet and the Profit and Loss Account have been drawn up in accordance with the provisions of section 29 of
the Banking Regulation Act, 1949 and section 133 of the Act and the relevant rules issued thereunder.
16. As required by sub-section (3) of section 30 of the Banking Regulation Act, 1949, 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
purpose of our audit and have found them to be satisfactory;
b) The transactions of the Bank, which have come to our notice during the course of our audit, have been within the powers
of the Bank; and
c) Since the key operations of the Bank are automated with the key applications integrated to the core banking system, the audit is
carried out centrally as all the necessary records and data required for the purposes of our audit are available therein. We have
visited 65 branches to examine the records maintained at the branches for the purpose of our audit.
17. In our opinion and to the best of our information and according to the explanations given to us, the provisions of Section 197 of the Act
are not applicable to the Bank by virtue of Section 35B(2A) of the Banking Regulation Act, 1949. Accordingly, the reporting under Section
197(16) of the Act regarding payment/ provision for managerial remuneration in accordance with the requisite approvals mandated by the
provisions of Section 197 read with Schedule V to the Act, is not applicable.
18. As required by section 143 (3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for
the purpose of our audit;
b) In our opinion, proper books of account as required by law have been kept by the Bank so far as it appears from our examination
of those books;
c) The Standalone Balance Sheet, the Standalone Profit and Loss Account and the Standalone Cash Flow Statement dealt with by this
report are in agreement with the books of account;
d) In our opinion, the aforesaid Standalone Financial Statements comply with the Accounting Standards specified under section
133 of the Act read with relevant Rules issued thereunder, to the extent they are not inconsistent with the accounting policies
prescribed by the RBI;
e) On the basis of the written representations received from the directors and taken on record by the Board of Directors, none of the
directors is disqualified as on 31 March 2026 from being appointed as a director in terms of Section 164(2) of the Act;
f) With respect to the adequacy of the internal financial controls with reference to Standalone Financial Statements of the Bank
and the operating effectiveness of such controls, refer to our separate Report in Annexure A, wherein we have expressed an
unmodified opinion; and
g) With respect to the other matters to be included in the Auditors’ Report in accordance with Rule 11 of the Companies (Audit and
Auditors) Rules, 2014 (as amended), in our opinion and to the best of our information and according to the explanations given to us:
i. The Bank has disclosed the impact of pending litigations on its financial position as at the year end in its Standalone Financial
Statements - Refer Schedule 12 (I), Schedule 17C - Note 13 and Schedule 18B Note 13 to the Standalone Financial Statements;
ii. The Bank 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 12 (II), 12 (Va) and 12 (Vb), Schedule 17C - Note 10,
Note 11 and Note 13 and Schedule 18A - Note 7 to the Standalone Financial Statements;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by
the Bank, during the year ended 31 March 2026;
iv. a. The management has represented that, to the best of its knowledge and belief, as disclosed in Schedule 18B - Note 15
to the Standalone Financial Statements, 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 Bank to or in any other person(s) or entity(ies),
including foreign entities (‘Intermediaries’), with the understanding, whether recorded in writing or otherwise, that the
Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner
whatsoever by or on behalf of the Bank (‘Ultimate Beneficiaries’) or provide any guarantee, security or the like on behalf
the Ultimate Beneficiaries;
b. The management has represented that, to the best of its knowledge and belief, as disclosed in Schedule 18B - Note
15 to the Standalone Financial Statements, no funds have been received by the Bank from any person(s) or entity(ies),
including foreign entities (’’Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the
Bank shall, whether directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever
by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of
the Ultimate Beneficiaries; and
c. Based on such audit procedures performed, as considered reasonable and appropriate in the circumstances, nothing has
come to our attention that causes us to believe that the management representations under sub-clauses (i) and (ii) of
Rule 11(e), as provided under (a) and (b) above contain any material misstatement.
v. The dividend declared and paid during the year ended 31 March 2026 by the Bank is in compliance with Section 123 of the Act.
vi. Based on our examination, which included test checks, the Bank has used accounting softwares for maintaining its books of
account for the financial year ended 31 March 2026 which have the feature of recording audit trail (edit log) facility and the
same has operated throughout the year for all relevant transactions recorded in the softwares. Further, during the course
of our audit we did not come across any instance of the audit trail feature being tampered with and the audit trail has been
preserved as per the statutory requirements for record retention, since enabled.
For Deloitte Haskins & Sells For M M NISSIM & CO LLP
Chartered Accountants Chartered Accountants
(Firm Registration No: 117365W) (Firm Registration No. 107122W/W100672)
G. K. Subramaniam Sanjay Khemani
Partner Partner
Membership Number. 109839 Membership Number. 044577
UDIN: 26109839AUFZQJ9713 UDIN: 26044577YWWWGA5425
Place: Mumbai Place: Mumbai
Date: 2 May 2026 Date: 2 May 2026
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