We have audited the attached standalone financial
statements of The Sukhjit Starch & Chemicals Limited (the
Company) as at March 31,2026, which comprise the Balance
Sheet, the Statement of Profit and Loss, the Statement of
Changes in Equity and the Statement of Cash Flow and
a summary of significant accounting policies and other
explanatory information. (herein after referred to as ''the
standalone Ind AS financial Statement'').
In our opinion and to the best of our information and
according to the explanations given to us, the aforesaid
Ind AS 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 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, 2026, the
profit and 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 Ind AS financial statements
in accordance with the Standards on Auditing ('SAs'),
as 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 Ind
AS 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 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 ICAI's Code of Ethics. We believe
that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the
Ind AS financial statements.
KEY AUDIT MATTERS
Key audit matters are those matters that in our professional
judgment, were significant in our audit of the standalone
financial statements for the financial year ended 31st
March 2026. 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 described below to be the key
audit matters to be communicated in our report.
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Key Audit Matters
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Auditor's Response
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Revenue recognition
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Revenue is one of the key profit drivers and is therefore
susceptible to misstatement. The timing of such revenue
recognition in case of sale of goods is when the control over
the same is transferred to the customer, which is mainly
upon delivery. Cut-off is the key assertion in so far as revenue
recognition is concerned.
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Our audit procedures with regard to revenue
recognition included:
• Substantive test check of sales transactions recorded
during the period closer to the year end, copy of orders,
customer' contracts, sales invoices and recoveries as
per sale orders / contracts etc and subsequent to the
year end inventory reconciliations.
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• Assessment of the Company's revenue recognition
accounting policies in line with Ind AS 115 (“Revenue
from Contracts with Customers”) and found that
the revenue has been recognized in accordance
with the revenue recognition policy and the
accounting standard.
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• The system of valuation of Finished Goods was also
verified and found in order, in consonance with the
Accounting Standard(s).
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Key Audit Matters
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Auditor's Response
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Inventory Management & its valuation
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We identified the inventories as a key audit matter as it
involves significant management judgments in determining
the level of inventory to be carried and its valuation.
The Company recognized inventory in the books of accounts
which is held by Company's units across India. Within each
storage location, inventory is stored in warehouses / sheds.
Further, there is huge significance of the inventory balance
to the profit statement of financial position and complexity
involved in determining inventory quantities on hand due
to the diversity of inventory storage locations, particularly,
the company's basic raw material being an agri-produce.
Moreover, under the volatile economic conditions during
the year amid ongoing geopolitical developments like
shifts in global tariff structure / war etc., determining
the Net Realisable Value of finished goods involved high
management judgment.
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Our audit procedures, amongst others, included
the following:
• Taking into account the installed capacities of various
units of company, we have verified that the company
duly maintains appropriate raw material inventory
levels to ensure continues running of operations
at all its units.
• Assessment of the management's inventory control
procedures, system of accounting for receipt / issue
of material, maintenance of appropriate records
for balance of stock on a daily basis and basis of
valuation of stock.
• Assessing the appropriateness of Company's
accounting policy for valuation of stock and compliance
of the policy with the requirements of the prevailing
accounting standards.
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•
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Reviewing the management's policy and methodology
for calculating the NRV of inventory, test checking the
reasonableness of management's estimated future
selling prices and performing sensitivity analyses on
key assumptions, such as a further decline in market
prices or extended holding periods etc.
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We conclude that the inventory is being maintained
at reasonable levels having regard to the nature of
business of the Company, prevalent market scenario
and seasonality involved in the procurement /
availability of the raw material. Further, the inventory
has been properly valued as per the Company's policy
and applicable Ind AS.
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There were no significant exceptions noted in the
systems / procedures.
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OTHER INFORMATION
The Company's Board of Directors is responsible for 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, Corporate Governance and Shareholder's
Information, but does not include the financial statements
and our auditor's report thereon.
Our opinion on the Ind AS 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 Ind AS 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.
MANAGEMENT'S RESPONSIBILITY FOR THE
FINANCIAL STATEMENTS :
The Company's Management is responsible for the
matters stated in Section 134(5) of the Companies Act,
2013 ('the Act') with respect to the preparation of these
financial statements that give a true and fair view of the
state of affairs, profit/ loss (including other comprehensive
income), changes in Equity and cash flow of the Company
in accordance with the accounting principles generally
accepted in India, including the India Accounting
Standards (Ind AS) specified under Section 133 of the Act.
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, 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 Ind AS financial statements, management
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 are also responsible for overseeing
the Company's financial reporting process.
AUDITOR'S RESPONSIBILITY :
Our objectives are to obtain reasonable assurance about
whether the Ind AS 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
Ind AS financial statements.
As part of an audit in accordance with Standards on
Auditing, 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 financial
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
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.
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.
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 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 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 Companies Act, 2013. We enclose in Annexure A,
statement on the matters specified in paragraphs 3 &
4 of the said order.
2. As required by 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. The Balance Sheet, the Profit and Loss
Statement, and the Cash Flow Statement dealt
with by this Report are in agreement with the
books of account.
iv. In our opinion, the aforesaid standalone financial
statements comply with the Accounting
Standards specified under Section 133 of the Act.
v. On the basis of the written representations
received from the directors as on March 31,
2026, taken on record by the Board of Directors,
none of the directors is disqualified as on March
31, 2026, from being appointed as a director in
terms of Section 164 (2) of the Act.
vi. 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 specific report in
''Annexure B''.
vii. In our opinion, the managerial remuneration
for the year ended March 31, 2026 has been
paid / provided by the Company to its directors
in accordance with the provisions of section 197
read with Schedule V to the Act; and
viii. 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 financial statements as referred to in
note to the financial statements.
b) The Company did not have any long-term
contracts including derivative contracts
for which there were any material
foreseeable losses.
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 it's knowledge
and belief, as disclosed in the notes
to the accounts, 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 person(s) or entity(ies), 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
by or on behalf of the Company
('Ultimate Beneficiaries') or provide
any guarantee, security or the like on
behalf of the Ultimate Beneficiaries.
(ii) The Management has represented,
that, to the best of it's knowledge
and belief, as disclosed in the notes to
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, 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.
(iii) Based on the audit procedures that
has been considered reasonable and
appropriate in the circumstances,
nothing has come to our notice that
has caused us to believe that the
representations under subclause (i)
and (ii) of Rule 11(e), as provided under
h (iv) (a) and (b) above, contain any
material misstatement.
e) The Company has paid dividend @ 20% for
FY 2024-25 during the year in accordance
with section 123 of the Act, as applicable. The
Board has also recommended dividend @
20% for FY 2025-26, subject to the approval
of shareholders in the ensuing AGM.
f) Based on our examination, which included
test checks, the Company has used
accounting software for maintaining its
books of account for the financial year
ended 31st March, 2026 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 the audit trail feature being
tampered with.
FOR Y K SUD & CO
CHARTERED ACCOUNTANTS
Firm Reg. No. 000047N
Sd/-
(Y K SUD)
Mepan class="font0">Memb. No. 16875
Place : Jalandhar Peer Review Certificate No. 014348
Dated : 27 May, 2026 UDIN : 26016875KCCJDB7731</
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