We have audited the accompanying Standalone Ind AS Financial Statements of W.S. Industries (India) Limited (“the
Company”), which comprise the standalone balance sheet as at 31st March 2025, the standalone statement of
Profit and Loss (Including Other Comprehensive Income), the standalone cash flow statements and the standalone
statement of changes in equity for the year then ended, and notes to the standalone financial statements, including
a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone
Ind AS financial statements give the information required by the Companies Act, 2013, as amended (“the Act”) in the
manner so required and give a true and fair view in conformity with the accounting principles generally accepted in
India, of the state of affairs of the Company as at March 31,2025, its loss including 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 of standalone 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 Standalone 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 standalone Ind AS
financial statements under the provisions of the Companies Act, 2013 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 audit opinion on the
standalone Ind AS financial statements.
Emphasis of Matter
Without qualifying our report, we draw attention to
a. Note No. 34 to the standalone Ind AS financial statements, which explains that amount payable to overseas
customers/suppliers aggregating to ? 5.55 crores written back during the earlier years pertains to erstwhile
Electro-porcelain products division (since discontinued) and management is in the process of obtaining necessary
approvals from the competent authorities. The impact if any arising on account of such write back of amounts
pending approvals is not ascertainable at this point of time.
b. The company is engaged in implementation of construction contracts, which envisage maintenance of cost
budgets associated with the implementation of projects which are prepared and periodically reviewed in order to
have an overall view of project outcome from time to time. Though the cost budgets and revisions are management
estimates, this process envisages implementation of control based budgetary process, pending which the current
process for arriving at the project outcomes which may be susceptible for deviations and the impact if any arising
therefrom, will be ascertainable only upon completion of the projects, hence no adjustments have been made in
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
standalone Ind AS financial statements for the financial year ended March 31,2025. These matters were addressed
in the context of our audit of the standalone Ind AS 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. For each matter below, our description of how
our audit addressed the matter is provided in that context.
1. Recognition of Contract Revenue:
|
Key Audit Matter
|
Audit Procedures
|
|
Contract revenue amounting to ?238.09 crores
for construction contracts which usually extends
over a period of 1-2 years and are fixed price
contract and in few cases the contracts enable
variance claims subject to acceptance.
In either case the contract revenue is measured
based on the proportion of contract costs
incurred for work performed to date relative to the
estimated total contract costs.
This method requires the Company to perform
an initial assessment of total estimated cost
and further, reassess the total construction cost
at each reporting period end to determine the
appropriate percentage of completion.
We considered the estimation of construction
contract cost as a key audit matter given
the involvement of significant management
judgement which has consequential impact on
revenue recognition.
|
Our procedures over the recognition of construction
revenue included the following:
• Understood and evaluated the design and tested
effectiveness of key internal financial controls,
including those related to review and approval of
estimated project cost and review of provision for
estimated loss by the authorised representatives.
• We obtained the percentage of completion
calculations, agreed key contractual terms to the
signed contracts, tested the mathematical accuracy
of the cost to complete calculations and re-performed
the calculation of revenue recognized during the
year based on the percentage of completion.
• For costs incurred to date, we tested samples
to appropriate supporting documentation and
performed cut off procedures.
• To test the forecast cost to complete, we obtained the
breakdown of costs forecasts and tested elements
of the forecast by obtaining executed purchase
orders and agreements, evaluating reasonableness
of management’s judgements.
• Checked the related disclosures in the financial
statements.
Based on the above procedures performed, we
considered the manner of estimation of contract cost
and recognition of revenue to be reasonable.
|
2. Related Party Transaction
|
Key Audit Matter
|
Audit Procedures
|
|
For the year under audit all the ongoing contracts
the Company has undertaken are with its related
parties which are stated to be at arm’s length.
These contracts envisage that in relation to back-
to-back contracts obtained by related parties
as the principal contractors have subcontracted
to the company. In addition, the company is
engaged in transactions relating to receipt of
loans, procurement of materials and hiring of
equipment from related parties, etc. which are
disclosed in Note No.40 to the standalone Ind AS
financial statements.
|
- Obtained and read the Company’s policies,
processes and procedures in respect of identifying
related parties, obtaining approval, recording and
disclosure of related party transactions.
- Read minutes of shareholder meetings, board
meetings and minutes of meetings of those charged
with governance, as applicable, in connection with
Company’s assessment of related party transactions
being in the ordinary course of business and at
arm’s length pricing (ALP) keeping in view of the
industry’s practices and ALP justification valuation
reports obtained by the company from certified
structural engineer and registered government
valuer.
|
|
Key Audit Matter
|
Audit Procedures
|
|
We identified the commercial arrangements
and pricing mechanism between the related
parties and its disclosure as set out in respective
notes to the standalone financial statements
as a key audit matter due to the significance of
transactions with related parties and associated
regulatory compliances thereon in relation to
disclosures and arm’s length pricing.
|
- Tested, on a sample basis, related party transactions
with the underlying contracts, confirmation letters
and other supporting documents
- Agreed the related party information disclosed in
the standalone Ind AS financial statements with
the underlying supporting documents, on a sample
basis on the basis of information and relevant
records made available to us.
|
Other Information
The Company’s Management and Board of Directors are responsible for the preparation of the other information.
The other information comprises the information included in the Company’s Annual Report, but does not include the
Financial Statements and our auditor’s report thereon. The above reports are expected to be made available to us
after the date of the auditor’s report.
Our opinion on the standalone 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 standalone Ind AS financial statements, our responsibility is to read the other
information identified above when it becomes available and, in doing so, consider whether the other information is
materially inconsistent with the standalone Ind AS financial statements or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
When we read the above reports, if we conclude that there is a material misstatement therein, we are required to
communicate the matter to those charged with governance and describe actions applicable under the applicable laws
and regulations.
Responsibilities of Management and those Charged with Governance for the 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 Ind AS Financial Statements that give a true and fair view
of the financial position, financial performance including Other Comprehensive Income, cash flows and changes
in equity of the Company in accordance with the accounting principles generally accepted in India, including the
Indian Accounting Standards (IND AS) specified under section 133 of the Act read with relevant rules issued
thereunder. 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 the 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 Ind AS 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 Ind AS 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 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 Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone 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 standalone Ind AS financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism
throughout the audit. We also:
• Identify and assess the risks of material misstatement of the standalone Ind AS 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 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.
• 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 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 Ind AS financial statements, including
the disclosures, and whether the standalone Ind AS 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 Ind AS financial statements of the financial year ended March 31,2025
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.
Other Matters
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.
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 of the aforesaid Standalone Financial Statements.
b) In our opinion, proper books of account as required by law for preparation of the aforesaid Standalone
Financial Statements have been kept by the Company so far as it appears from our examination of those
books except for the matters stated in the paragraph 2(h)(vi) below on reporting under Rule 11(g) of the
companies (Audit and Auditors) Rules, 2014.
c) The Standalone Balance Sheet, the Standalone Statement of Profit and Loss including other comprehensive
income, the Standalone Cash Flow Statement and the Standalone Statement of Changes in Equity dealt
with by this Report are in agreement with the books of accounts.
d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Ind AS specified under
Section 133 of the Act, read with Companies (Indian Accounting Standard) Rules, 2015, as amended.
e) On the basis of the written representations received from the directors as on 31st March, 2025 taken on
record by the Board of Directors, none of the directors is disqualified as on 31st March, 2025 from being
appointed as a director in terms of Section 164 (2) of the Act.
f) The modifications relating to the maintenance of accounts and other matters connected therewith are as
stated in the paragraph 2(b) above on reporting under Section 143(3)(b) of the Act and paragraph 2(h)(vi)
below on reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014
g) With respect to the adequacy of the internal financial controls over financial reporting of the Company
with reference to these standalone Ind AS financial statements and the operating effectiveness of such
controls, refer to our separate Report in “Annexure B” to this report.
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
Ind AS financial statements - Refer Note No.36 to standalone Ind AS financial statements.
ii. The Company did not have any long-term contracts including derivative contracts for which there
were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education
and Protection Fund by the Company
iv. (a) The Management has represented that, to the best of its knowledge and belief, during the year
no funds (which are material either individually or in the aggregate) other than those disclosed in
the notes to accounts, 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
or entity, including foreign entity (“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 the aggregate) have been received by the Company from any person
or entity, including foreign entity (“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;
(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(e), as provided under (a) and (b) above, contain any material
misstatement.
v. The company has not declared any dividend during the current year and the previous year, hence the
clause regarding the compliance with section 123 of the Act is not applicable.
vi. According to the information and explanation given to us and based on our examination which included
test checks, the Company uses an accounting software for maintaining its books of account, which has
a feature of recording audit trail (edit log) facility and the same was enabled on 08th May 2024 and has
operated since then throughout the year for all relevant transactions recorded in the software and we did
not come across any instance of audit trail feature being tampered with during the course of our audit.
According to the information and explanations provided to us, other than the periods where audit trail was
not enabled in the current financial year and previous financial year, the audit trail has been preserved by
the company as per the statutory requirements for record retention.
3. In our opinion and according to the information and explanations given to us, the remuneration provided by the
Company to its directors during the current year is in accordance with the provisions of section 197 of the Act.
For Brahmayya & Co.,
Chartered Accountants
Firm Regn No: 000511S
Place: Chennai
Date: 27-05-2025
N. Sri Krishna
Partner
Membership No.026575
UDIN: 25026575BMLHGF2218
| 