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S.
No.
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Key Audit Matters
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Audit procedures
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1.
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Cut off risk in Revenue Recognition
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Due to the sales being under various contractual terms
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•
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We have assessed the revenue recognition policies of the
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and across geographies, delivery to customers in different
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Company including accounting for sales returns and discounts
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regions might take different time periods and may result in
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for compliance with Ind AS.
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undelivered goods at the period end. We consider there to be
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•
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The Company has manual and automated (information
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a risk of misstatement of the financial statements related to
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technology - IT) controls on recording revenue and accruals
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transactions occurring close to the year end, as transactions
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for sales returns and discounts. We tested the design,
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could be recorded in the wrong financial period.
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implementation and operating effectiveness of these controls.
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Accordingly, cut-off risk in revenue recognition is a key audit
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In respect of cut-off, we focused on controls around the timely
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matter.
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and accurate recording of year-end sales transactions.
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•
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We have performed substantive testing on sample check basis
on revenue transactions recorded during the year end.
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•
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We verified contractual terms of the invoice and tested the
transit time to deliver the goods.
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2.
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Capital Expenditure in respect of property, plant and
equipment and capital work in progress
The Company has incurred significant expenditure on capital
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•
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We have obtained an understanding of the Company's
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projects, as reflected by the total value of additions in
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capitalization policy and assessed for compliance with the
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property plant and equipment and capital work in progress
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relevant accounting standards.
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in notes 3 and 5 of the standalone financial statements.
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We have obtained understanding, evaluated the design and
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We considered Capital expenditure as a Key audit matter
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tested the operating effectiveness of controls related to
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due to:
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capital expenditure and capitalization of assets.
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S.
No.
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Key Audit Matters
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Audit procedures
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• Significance of amount incurred on such items during
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•
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We have performed substantive testing on a sample
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the year ended 31 March 2025.
• Judgement and estimate required by management in
assessing assets meeting the capitalization criteria set
out in Ind AS 16 Property, Plant and Equipment.
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check basis for each element of capitalized costs including
inventory issued to contractors for the purpose of these
projects and physical verification performed by management
along with reconciliation and directly attributable cost,
including verification of underlying supporting evidence and
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• Judgement involved in determining the eligibility
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understanding nature of the costs capitalized.
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of costs including borrowing cost and other directly
attributable costs for capitalization as per the criteria
set out in Ind AS 16 Property, Plant and Equipment.
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We have obtained understanding on management assessment
relating to progress of projects and their intention to bring
the asset to its intended use.
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3.
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Valuation, Accuracy, Completeness and disclosures
pertaining to Inventories with reference to Ind AS 2
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Inventories constitutes material component of standalone
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Our audit approach consisted testing of the design and operating
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financial statement. Correctness, Completeness and
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effectiveness of the internal controls and substantive testing as
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Valuation are critical for reflecting true and fair financial
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follows:
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results of operations. Further due to continuous nature of
plan operations and the raw materials which are basically
chemicals, management has to exercise judgement in
assessing stage of the product and its valuation.
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We have assessed the Company's process regarding
maintenance of records, Valuation and accounting of
transactions relating to Inventory as per the Indian Accounting
Standard 2.
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Also refer note 13 to the standalone financial statement.
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We have evaluated the design of Internal Controls relating to
recording and valuation of Inventory.
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We have carried out substantive audit procedures to verify
the allocation of overheads to Inventory.
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We have attended the physical verification of Inventories
performed by the Management and also performed
stock count on sample check basis. We have also checked
reconciliation of inventories as per physical inventory
verification and book records on a sample check basis.
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•
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For sample selected, we have also obtained confirmation of
Inventories held with third parties.
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We have verified the consistency in respect of valuation
process and methodology followed by the Company.
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We have audited the accompanying standalone financial statements
of Tatva Chintan Pharma Chem Limited ("the Company") which
comprises the balance sheet as at 31 March 2025 and the
statement of profit and loss (including other comprehensive
income), 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 summary of material accounting
policies and other explanatory information. (hereinafter referred
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 31 March 2025 and
total comprehensive income (comprising of profit and other
comprehensive income), its cash flows and the changes in equity
for the year ended on that date.
Basis for Opinion
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 "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 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 fulfilled 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
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 matters described below to be the key audit
matters to be communicated in our report:
Other Information
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
Board's Report, Management Discussion and Analysis, Report on
Corporate Governance, Business Responsibility and Sustainability
Report, but does not include the standalone financial statements
and our auditor's report thereon. The Annual Report is expected
to be made available to us after the date of this auditor's 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. When we read the Annual Report, if we conclude that
there is a material misstatement therein, we are required to report
that fact. We have nothing to report in this regard.
Responsibilities of Management and Those Charged
with Governance 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 standalone
financial position, standalone financial performance including
other comprehensive income, standalone changes in equity and
standalone cash flows of the Company in accordance with the
accounting principles generally accepted in India, including the
Accounting Standards specified under section 133 of the Act read
with the Companies (Indian Accounting standards) Rules, 2015
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
of the appropriate accounting software for ensuring compliance
with applicable laws and regulations including those related to
retention of audit logs; selection and application of appropriate
implementation and maintenance of 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 standalone financial
statement 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 Company's Board of Directors are also responsible for
overseeing the Company's financial reporting process.
Auditor's 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 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 controls relevant to the
audit in order to design audit procedures that are appropriate
in the circumstances. Under section 143(3)(i) of the
Companies Act, 2013, we are also responsible for expressing
our opinion on whether the Company has adequate internal
financial controls with reference to 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 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 Company 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 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 (i) in 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 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, 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, the statement of profit and loss
(including other comprehensive income), the statement
of change in equity, the statement of cash flows and
notes to 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 Accounting Standards
specified 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 as on 31 March 2025 taken on record
by the Board of Directors, none of the directors is
disqualified as on 31 March 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 with reference to standalone financial
statements 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) The Company has paid/provided for managerial
remuneration in accordance with the requisite approvals
mandated by the provisions of section 197 read with
Schedule V to 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 (as amended),
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 - Refer Note 46 to the
standalone financial statements.
ii. The Company does not have any long-term
contracts including derivative contracts for which
there were any material foreseeable losses.
iii. There were no amounts which were required to be
transferred to Investor Education and protection
fund by the Company.
iv. (a) The management has represented that,
to the best of its knowledge and belief, 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
persons or entities, 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;
iv. (b) The management has represented that,
to the best of its knowledge and belief, no
funds have been received by the Company
from any persons or entities, 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
iv. (c) Based on such audit procedures that 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 (a) and (b)
above contain any material misstatement.
iv. (d) The dividend declared and paid, if any, during
the year by the Company is in compliance
with section 123 of the Act.
v. Based on our examination which included test
checks, the Company, in respect of financial
year commencing on 1 April 2024, have used an
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 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.
Furthermore, the audit trail has been preserved by
the Company as per the statutory requirements
for record retention from the date the audit trail
was enabled for the accounting software.
For NDJ & Co.,
Chartered Accountants
Firm's Registration Number: 136345W
CA Basant Chandak
Partner
Date: 2 May 2025 Membership No.: 434585
Place: Vadodara UDIN No: 25434585BMISWR6500
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