We have audited the accompanying financial statements of AI Champdany Industries Limited ("the Company"), which
comprise the Balance Sheet as at 31st March 2025, the statement of profit and loss (including other comprehensive
income), the statement of changes in Equity and the cash flow statement for the year on that date, and a summary of
significant accounting policies and other explanatory information (hereinafter referred to as "the financial statement").
In our opinion and to the best of information and according to the explanations given to us, the aforesaid financial state¬
ments give the information required by the Companies Act, 2013 (the "Act") in the manner so required and give a true and
fair view in conformity with Indian Accounting Standards prescribed under section 133 of the Act read with the Compa¬
nies (Indian Accounting Standards) Rules, 2015, as amended ("Ind AS") and other accounting principles generally accept¬
ed in India, of the state of affairs of the company as at 31st March 2025, the loss, comprehensive income/loss, changes in
equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted the audit of financial statements in accordance with the Standards on Auditing (SAs) specified under
section 143(10) of the Act (SAs). Our responsibilities under those Standards are further described in the Auditor's Respon¬
sibilities for the Audit of the Financial Statements section of our report. We are independent of the company in accor¬
dance with the Code of Ethics issued by the Institute of the Chartered Accountants of India (ICAI) together with indepen¬
dence requirements that are relevant to our audit of the financial statements under the provisions of the Act and the
Rules made there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements
and the ICAI's Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide the basis for our audit opinion on the financial statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
financial statements of the current period. These matters were addressed in the context of our audit of the financial state¬
ments as a whole, and in forming of opinion thereon, and we do not provide a separate opinion on these matters.
Key audit matter How our audit addressed the key audit matter
A. Input Output ratio: Our key procedures included the following:
Low contribution margin is attributed to processing of
old inputs leading to extra process resulting in increased
cost of production as per technical report submitted by
management which has been relied upon by us.
Our key procedures included the following:
B. Sundry Debtors Old outstanding dues against sundry debtors part of
which appearing in barred by time limitation not being
provided for on stated ground of realizability of same
which has been relied upon by us.
Our key procedures included the following:
C. Revenue Recognition a) Assessed the appropriateness of the company's
revenue recognition accounting policies, including
Revenue for the company consists primarily of sale of those relating to discounts, incentives and rebates by
products. comparing with the applicable accounting standards;
b) Tested the operating effectiveness of the general IT
Revenue from the sale of products is recognized at the control environment and key IT application controls over
moment when performance obligation of the underlying recognition of revenue, calculation of discounts,
products have been completed and is measured net of incentives and rebates;
discounts, incentives and rebates given to the customers. c) Performed test of details:
|
The estimation of discounts, incentives and rebates
recognized, related to sales made during the year, is
material and considered to be complex and judgmental.
Therefore, there is a risk of revenue being misstated as a
result of inaccurate estimates of discounts, incentives
and rebates.
Further, the company focuses on revenue as a key
performance measure. Therefore, revenue was our area
of focus included whether the accruals were misstated
and appropriately valued, whether rebates and discounts
was recorded in the correct period and whether the
significant transactions had been accurately recorded in
the Statement of Profit and Loss.
Refer corresponding note for amounts recognized as
revenue from sale of products
|
i) Agreed samples of sales, discounts, incentives and
rebates to supporting documentation and approvals;
and
ii) Obtained supporting documents for sales
transactions recorded either side of year end as well as
credit notes issued after the year ended to determine
whether revenue was recognized in the correct period.
d) Performed focused analytical procedures:
i) Compared the revenue for the current year with the
prior year for variance/ trend analysis and where
relevant, completed further inquiries and testing to
corroborate the variances by considering both internal
and external benchmarks, overlaying our understanding
of industry; and
ii) Compared the discounts, incentives and rebates of
the current year with the prior year for variance/ trend
analysis and where relevant, completed further inquiries
and testing to corroborate the variances by considering
both internal and external benchmarks, overlaying our
understanding of industry
e) Considered the appropriateness of the company's
description of the accounting policy, disclosures related
to revenue, discounts, incentives and rebates and
whether these are adequately presented in the financial
statement.
Due cognizance has been taken during the course of
|
|
D. One shareholder has lodged a petition against the
company, whose allegation includes inter-alia various
accounting treatment / disclosure in financial
statement.
E. Litigations and claims -provisions and contingent
liabilities
As disclosed in Notes detailing contingent liability and
provision for contingencies, the company is involved in
direct, indirect tax and other litigations ('litigations') that
are pending with different statutory authorities.
Whether a liability is recognized or disclosed as a
contingent liability in the financial statements is
inherently judgmental and dependent on a number of
significant assumptions and assessments.
The amounts involved are potentially significant and
determining the amount, if any, to be recognized or
disclosed in the financial statements, is inherently
subjective.
|
verification, of specific issues raised by the complainant
for the purpose of certifying the financial statement in
true and fair perspective.
Our key procedures included the following:
• Assessed the appropriates of the company's accounting
policies, including those relating to provision and
contingent liability by comparing with the applicable
accounting standards;
• Assessed the company process for identification of the
pending litigations and completeness for financial
reporting and also for monitoring of significant
developments in relation to such pending litigations;
• Engaged subject matter specialists to gain an
understanding of the current status of litigations and
monitored changes in the disputes, if any, through
discussions with the management and by reading
external advice received by the company, where
relevant, to establish that the provisions had been
appropriately recognized or disclosed as required;
• Assessed the company's assumptions and estimates in
respect of litigations, including the liabilities or
provisions recognized or contingent liabilities disclosed
in the financial statements. This involved assessing the
probability of an unfavorable outcome of a given
proceeding and the reliability of estimates of related
amounts;
• Performed substantive procedures on the underlying
calculations supporting the provisions recorded;
• Assessed the management's conclusions through
|
| |
understanding precedents set in similar cases; and
Considering the appropriateness of the company's
description of the disclosures related to litigations and
whether these adequately presented in the financial
statements.
|
|
F. Valuation of investments and impairment thereof
|
Verified with reference to latest registered valuers report;
|
|
I. Non-Current Investments in Unquoted equity
instruments.
|
Valuation report based on simple average of valuation of
|
|
II. Current Investments in unquoted mutual funds.
|
investee on EBIDTA concept, Revaluation concept, and
Discounted cash flow concept.
|
|
III. Fixed Deposit with Bank.
|
Verified with reference to duly declared NAV of the
|
| |
investee.
Verified with reference to banks confirmation and
computation of interest accrued thereon.
|
Information Other than the Financial Statements and Auditor's Report There
The Company's Board of Directors is responsible for the preparation of the other information. The other information
comprises the information included in the Management Discussion and Analysis, Board's Report including Annexures to
Board's Report, Business Responsibility Report, Corporate Governance and Shareholders' information, but does not
include the financial statements and our auditor's report thereon.
Our opinion on the 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 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 during the course of our 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 Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to
preparation of these financial statements that give a true and fair view of the financial position, financial performance,
total comprehensive income, changes in equity and cash flows of the companies in accordance with the Ind AS and other
accounting principles generally accepted in India. The respective Board of Directors of the companies are responsible for
maintenance of the adequate accounting records in accordance with the provisions of the Act for safeguarding the
asseof the companies 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
statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors of the company is 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.
The Board of Directors is also responsible for overseeing the company's financial reporting process.
Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the 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 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 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 controls 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 system 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 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 ability of the Group 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 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 financial statements, including the disclosures, and
whether the financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities
within the company to express an opinion on the financial statements. We are responsible for the direction,
supervision and performance of the audit of the financial statements of such entities included in the financial
statements.
Maturity is the magnitude of misstatements in the financial statements that, individually or in aggregate, makes it
probable that the economic decisions of a reasonably knowledgeable user of the 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 financial statements.
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 financial statements of the current period 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.
Report on Other Legal and Regulatory Requirements
1. As required by section 197(16) of the Act based on our audit, we report that the Company has paid remuneration to
its directors during the year in accordance with the provisions of and limits laid down under section 197 read with
Schedule V to the Act.
2. As required by Section 143(3) of the Act, based on our audit we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief
were necessary for the purposes of our audit of the aforesaid financial statements.
b) In our opinion, proper books of account as required by law relating to preparation of the aforesaid financial
statements have been kept so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive Income), Statement of Changes
in Equity and the Statement of Cash Flows dealt with by this Report are in agreement with the relevant books of
account maintained for the purpose of preparation of the financial statements.
d) In our opinion, the aforesaid financial statements comply with the Ind AS specified under Section 133 of the Act, read
with Rule 7 of the Companies (Accounts) Rules, 2014.
e) On the basis of written representations received from the directors as on 31stMarch, 2025 taken on record by the
Board of Directors, none of the directors is disqualified as on 31stMarch, 2025 from being appointed as a director in
terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial reporting of the company and the
operating effectiveness of such controls, refer to our separate report in "Annexure 1". Our report expresses an
unmodified opinion on the adequacy and operating effectiveness of the company's internal financial controls over
financial reporting.
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, as amended in our opinion and to the best of our information and according to the
explanations given to us:
i. The financial statements disclose impact of pending litigations on the financial position of the company in note no. 26
of financial statement.
ii. The company has not entered into long term contracts.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection
Fund by the company.
iv. To the best of it's knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been
advanced or longed or invested (either from borrowed funds or share premium or any other sources or kind of funds)
by the company to or in any other person(s) or entity(ies), including foreign entities ("Intermediaries"), with the
understanding whether recorded in writing or invest in other persons or entities indentified in any manner
whatsoever by or on behalf of the company ("Ultimate Beneficiaries") or provided any guarantee, security or the like
on behalf of the Ultimate Beneficiaries;
v. To the best of it's knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been
received by the company from any person(s) or entity(ies), including foreign entities ("Funding Parties"), with the
understanding, whether recorded in writing or otherwise, that the company shall, 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;
vi. Nothing has come to our notice that has caused us to believe that the representation under clause (iv) and (v) above
contain any material mis-statement.
vii. No dividend or part was declared by company during the year as per Section 123 of Companies Act, 2013.
viii. Based on our examination which included test checks, observe that the company has used an accounting software,
i.e, Oracle-based for maintaining its books of account during the year. During the course of our audit, we did not come
across any instance of audit trail feature being tampered with.
3. As required by the Companies (Auditor's Report) Order, 2020 ("the Order") issued by the Central Government in terms
of Section 143(11) of the Act, we give in "Annexure 2" a statement on the matters specified in paragraphs 3 and 4 of the
Order to the extent applicable.
For G. Basu & Co.
Chartered Accountants
UDIN : 25052498BNIYCU8992 R. No. 301174E
Place : Kolkata KalyanBiswas
Partner
Date : 30th May, 2025 MRN 052498
|