We have audited the accompanying standalone financial
statements of PSP Projects Limited (the “Company”), which
comprise the Balance Sheet as at March 31, 2025, the Statement
of Profit and Loss (including Other Comprehensive Loss), the
Statement of Changes in Equity and the Statement of Cash Flows
for the year then ended, and notes to the standalone financial
statements, including a summary of material accounting policies
and other explanatory information (hereinafter referred to as
'standalone financial statements’).
In our opinion and to the best of our information and according to
the explanations given to us, the aforesaid standalone financial
statements give the information required by the Companies Act,
2013 (the “Act”), in the manner so required, and give a true and
fair view in conformity with the Indian Accounting Standards
prescribed under section 133 of the Act read with the Companies
(Indian Accounting Standards) Rules, 2015, as amended ("Ind
AS") and other accounting principles generally accepted in India,
of the state of affairs of the Company as at March 31, 2025 and its
profit, total comprehensive income, changes in equity and its cash
flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the standalone financial statements
in accordance with the Standards on Auditing (SAs) specified
under section 143(10) of the Act. Our responsibilities under those
Standards 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 (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 made thereunder, 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 obtained by us is sufficient and appropriate to
provide a basis for our audit opinion on the standalone financial
statements.
Key Audit Matters
Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the standalone
financial statements of the current period. These matters were
addressed in the context of our audit of the standalone financial
statements as a whole, and in forming our opinion thereon, and
we do not provide a separate opinion on these matters. We have
determined the matter described below to be the key audit matter
to be communicated in our report.
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S.
No.
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Key Audit Matter
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Auditor’s Response
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1.
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Revenue Recognition and Trade Receivables
There are significant accounting judgements including
estimation of costs to complete, determining the stage of
completion and the timing of revenue recognition.
The Company recognises revenue and profit or loss on the
basis of stage of completion based on the proportion of
contract costs incurred at balance sheet date.
The Indian Accounting Standard requires an entity to select
a single measurement method for the relevant performance
obligation that depicts the entity’s performance in transferring
goods or services or if a contract is onerous, present
obligations are recognized and measured as provisions.
We identified contract accounting as a key audit matter
because the estimation, of the total revenue and total cost
to complete the contract, prepared based on the prevailing
circumstances, is inherently subjective, complex and
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Our procedures included:
Ý Testing of the design and implementation of controls
involved for the determination of the estimates used as well
as their operating effectiveness;
Ý We selected a sample of contracts to test, using a risk
based criteria which included individual contracts with:
• significant revenue recognised during the year or
• significant accrued value of work done balances held
at the year-end;
Ý Obtained an understanding of management’s process for
reviewing long term contracts, the risk associated with the
contract and any key judgments.
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S.
No.
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Key Audit Matter
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Auditor’s Response
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require significant management judgment and forecast of
contract revenue and/or contract cost may get subsequently
changed due to change in prevailing circumstances,
assumptions, contract variations or any other factor, and
could result in material variance in the revenue and profit or
loss from contract for the reporting period.
Receivables has been considered a key audit matter due to
the significance of the amount (H52,801.04 lakh) and element
of judgement involved in overall management assessment of
the customers’ ability to repay the outstanding balance.
Refer to note number 2.15, 12 and 39 of the standalone financial
statements.
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Ý Evaluated the design and implementation of key internal
controls over the contract revenue and cost estimation
process through the combination of procedures involving
inquiry and observations, reperformance and inspection of
evidence in respect of operations of these controls.
Ý Verified underlying documents such as original contract,
and its amendments, if any, key contract terms and
milestones, etc. for verifying the estimation of contract
revenue and costs and /or any change in such estimation.
Ý Inquired with management on the progress of works and
collections from customers to identify specific customers
with which the company might have disagreements or
disputes.
Ý Tested samples of un-invoiced revenue entries with
reference to the reports from the records and costs
incurred against the services delivered to confirm the work
performed and application of appropriate margin applied
for the respective services.
Ý Tested cut-offs for revenue recognized against un- invoiced
amounts by matching the revenue accrual against accruals
for corresponding cost;
Ý Reviewed the work done and collection history of
customers against whose contracts unbilled revenue is
recognised; and verification of subsequent receipts, post
balance sheet date.
Ý Obtained confirmations from customers on sample basis
to support existence assertion of trade receivables and
assessed the relevant disclosures made in the Standalone
Financial Statements; to ensure revenue from contracts
with customers are in accordance with the requirements of
relevant accounting standards.
Ý Evaluated the nature and status of customers and obtained
the understanding from management about whether on¬
going business relationship with the customers and past
payment history of customers.
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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 information included in the Board's Report including
Annexures to the Board's Report, Management Discussion and
Analysis, Business Responsibility and Sustainability Report,
Corporate Governance and Shareholder's Information, but does
not include the standalone financial statements and our auditors’
report thereon. The other information 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 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 communicate the matter to those
charged with governance as required under SA 720 ’The Auditors’
responsibilities relating to other Information’. We have nothing to
report in this regard.
Management’s 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 financial position,
financial performance, including total comprehensive income,
changes in equity and cash flows of the Company in accordance
with the accounting principles generally accepted in India,
including the Ind AS specified under section 133 of the Act and the
rules thereunder, as amended. 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
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 or Board of
Directors either intend to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.
The Board of Directors is also responsible for overseeing the
Company’s financial reporting process.
Auditor’s responsibilities for the audit of the
Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether
the standalone financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with SAs will always detect a
material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or
in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these
standalone financial statements.
As part of an audit in accordance with SAs, we exercise
professional judgment and maintain professional scepticism
throughout the audit. We also:
Ý 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.
Ý 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 system
in place and the operating effectiveness of such controls.
Ý Evaluate the appropriateness of accounting policies used
and the reasonableness of accounting estimates and related
disclosures made by management.
Ý 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 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.
Ý 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, make
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.
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 for
the financial year ended March 31, 2025 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.
Report on other legal and regulatory requirements
1. As required by the Companies (Auditor’s Report) Order,
2020 ('the Order’), issued by the Central Government of India
in terms of sub-section (11) of section 143 of the Act, we give
in the 'Annexure A', a statement on the matters specified in
paragraphs 3 and 4 of the Order, to the extent applicable.
2. As required by section 143(3) of the Act, 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.
(b) 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.
(c) The Balance Sheet as at March 31, 2025, the Statement
of Profit and Loss (including Other Comprehensive
Loss), the Statement of Changes in Equity and the
Statement of Cash Flows for the year then ended dealt
with by this Report are in agreement with the books of
account.
(d) In our opinion, the standalone financial statements
comply with the Ind AS specified under section 133 of
the Act and the Rules thereunder, as amended.
(e) On the basis of the written representations received
from the directors as on March 31, 2025, taken on
record by the Board of Directors, none of the directors is
disqualified as on March 31, 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 with
reference to the financial statements and the operating
effectiveness of such controls, refer to our separate
Report in 'Annexure B' to this report.
(g) With respect to the other matters to be included in the
Auditor's Report in accordance with the requirements of
sub-section (16) of Section 197 of the Act, as amended,
we report that to the best of our information and
according to the explanations given to us, remuneration
paid by the Company to its directors during the year is in
accordance with the provisions of Section 197 of the Act.
(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 standalone
financial statements. Please refer Note No. 38(i).
(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;
(iii) During the year, the Company has transferred Rs.
0.15 lakhs pertaining to the Financial Year 2016-17 to
Investor Education and Protection Fund with delay
of 32 days.
(iv) (a) The management has represented that, to
the best of its knowledge and belief, no funds
(which are material either individually or in
aggregate) have been advanced or loaned or
invested (either from borrowed funds or share
premium or any other sources or kind of funds)
by the Company to or in any other person(s)
or entity(ies), including foreign entities
(“Intermediaries”), with the understanding,
whether recorded in writing or otherwise,
that the Intermediary shall, whether, directly
or indirectly, lend or invest in other persons or
entities identified in any manner whatsoever
by or on behalf of the Company (“Ultimate
Beneficiaries”) or provide any guarantee,
security or the like on behalf of the Ultimate
Beneficiaries;
(b) The management has represented, that,
to the best of its knowledge and belief, no
funds (which are material either individually
or in aggregate) 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; and
(c) Based on the audit procedures that have been
considered reasonable and appropriate in
the circumstances, nothing has come to our
notice that has caused us to believe that the
representations under sub-clause (i) and (ii) of
Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, as provided in (a) and (b) above,
contain any material misstatement.
(v) The Company has not declared or paid any dividend
during the year, and hence, reporting, under sub¬
clause (f) of Rule 11 of the Companies (Audit and
Auditors) Rules, 2014.
(vi) Based on our examination, which included test
checks, the Company has used an accounting
software for maintaining its books of account for
the financial year ended March 31, 2025 which has
a feature of recording audit trail (edit log) facility
and the same has operated throughout the year for
all relevant transactions recorded in the software.
Further, during the course of our audit we did not
come across any instance of audit trail feature being
tampered with. Additionally, the audit trail has been
preserved by the Company as per the statutory
requirements for record retention.
For Kantilal Patel & Co. For Prakash B. Sheth & Co.
Chartered Accountants Chartered Accountants
ICAI Firm registration number: 104744W ICAI Firm registration number: 108069W
Jinal A. Patel Prakash B. Sheth
Partner Proprietor
Membership No.: 153599 Membership No.: 036831
Place: Ahmedabad Place: Ahmedabad
Date: May 23, 2025 Date: May 23, 2025
UDIN: 25153599BMJLRP9718 UDIN: 25036831BMIKZS4946
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