We have audited the accompanying standalone financial statements of PAOS 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 Statement of Cash Flows Statement for the year ended on that
date and a summary of significant accounting policies and other explanatory information, (hereinafter referred to as
"the 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, its loss
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 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 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 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. We have determined the following key audit matter to
communicate in our report.
1. Acquisition of Business Transfer Agreement (BTA):
The company has entered into Business transfer agreement dated 16th July, 2024 to acquire the running business of M/s
National Soap Mills (a partnership firm in which the directors of the company are partners) for a consideration
discharged through the issue of 8% Non-Convertible Debentures, redeemable after 10 years from the date of issue.
Audit Procedure: Our audit procedures included, but were not limited to, verifying the accounting treatment of this
transaction in accordance with the provisions of Ind AS 103 (Business Combinations) and Ind AS 109 (Financial
Instruments).
Information Other than the Financial Statements and Auditor's Report Thereon
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, Business Responsibility Report, Corporate Governance and Shareholders' Information, but does not include the
standalone financial statements and our auditor's report thereon.
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 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 Responsibilities for the Standalone Financial Statements
The accompanying standalone financial statements have been approved by Company's Board of Directors. The
Company's Board of Directors is 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 other comprehensive income, changes in equity and cash flows of the Company in accordance
with the Ind AS and other accounting principles generally accepted in India.
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;
• 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 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 responsible for overseeing the Company's financial reporting process.
Auditors' Responsibility for the Audit of 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 Standards on Auditing specified under section 143(10) of the Act, we exercise
professional judgement 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 controls.
• 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 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 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 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 under the provisions of 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 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 standalone financial statements 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 Indian Accounting Standards
prescribed under section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as
amended.
e) On the basis of the written representations received from the directors of the Company 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 and the
operating effectiveness of such controls, refer to our separate Report in "Annexure B". 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 other matters to be included in the Auditors' Report under section 197(16) of the Act, We report
that the company has not paid any remuneration to its directors during the year.
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, as amended, in our opinion and to the best of our information and
according to the explanations given to us:
a) The Company does not have any pending litigations as on March 31, 2025;
b) The Company did not have any long-term contracts including derivative contracts for which there were any
material foreseeable losses;
c) There is no such amount, which is 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, other than 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) 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;
(ii) The management has represented, that, 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; and
(iii) Based on audit procedures which we 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) contain any
material mis-statement.
e) The company has not declared or paid any dividend during the year in contravention of the provisions of section
123 of the Companies Act, 2013.
f) The company has used such accounting software for maintaining its books of account which has a feature of
recording audit trail (edit log) facility and the same has been operated throughout the year for all transactions recorded
in the software and the audit trail feature has not been tampered with and the audit trail has been preserved by the
company as per the statutory requirements for record retention.
FOR RAKSHIT KHOSLA& ASSOCIATES
CHARTERED ACCOUNTANTS
(POOJA SHARMA)
PARTNER
M. NO: 562557
FRN:017151N
PLACE: LUDHIANA
DATE: 29-05-2025
UDIN: 25562557BMKOHG6671
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