1. We have audited the accompanying standalone financial
statements of KDDL 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 Statement of Cash
Flow and the Standalone Statement of Changes in Equity for
the year then ended, and notes to the standalone financial
statements, including material accounting policy information
and other explanatory information.
2. 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 ('Ind AS') specified under
section 133 of the Act read with the Companies (Indian
Accounting Standards) Rules, 2015 and other accounting
principles generally accepted in India, of the state of affairs of
the Company as at 31st March 2025, and its profit (including
other comprehensive income), its cash flows and the changes
in equity for the year ended on that date.
BASIS FOR OPINION
3. We conducted our audit in accordance with the Standards
on Auditing 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 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.
KEY AUDIT MATTERS
4. 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.
5. 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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How our audit addressed the key audit matters
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Capitalisation of Property, Plant and Equipment-
Refer notes 2.2(c) for material accounting policy information and
note 3, 51 and 54 to the standalone financial statements in relation
to property, plant and equipment ('PPE').
During the current year, the Company has capitalised capital
expenditure of ? 2,978 lacs with respect to setting up of two new
production facilities i.e., manufacturing watch bracelets at Karnataka
and packaging watch accessories at Haryana, comprising 22.31% of
gross carrying value of total Property, Plant and Equipment ('PPE') as
at 31st March 2025.
Such capital expenditure includes purchase costs and other costs
including overheads directly attributable for bringing the assets
to the location and condition necessary for it to be capable of
operating in the manner intended by management, which have
been capitalised under various classes of PPE in accordance with the
principles of Ind AS 16, Property, Plant and Equipment ('Ind AS 16').
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Our audit procedures included, but were not limited to, the
following:
- Obtained an understanding of the business process relating to
capitalisation of PPE and assessed the appropriateness of the
accounting policy adopted by the Company in accordance with
Ind AS 16;
- Evaluated the design and tested operating effectiveness of key
internal financial controls with respect to the capitalisation of
PPE;
- Tested the additions made to PPE on a sample basis by checking
underlying supporting documents such as invoices, goods
received notes (GRNs), material receipt forms, etc. to ensure
such items are recorded accurately with correct amount, in the
correct class of PPE and in the correct period;
- Obtained the completion/installation certificate provided by
the technical team to determine appropriateness of timing of
capitalisation;
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Key audit matters
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How our audit addressed the key audit matters
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The above non-recurring event for the Company required significant
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In respect to allocated overheads, checked the reasonableness
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management efforts and judgement to identify costs that meet
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and appropriateness of such allocation;
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the recognition criteria under Ind AS 16, determine timing of
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Assessed the appropriateness of useful economic lives and
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capitalisation, classification of PPE under various classes, estimate
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residual values with reference to the Company's historical
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useful lives and assign residual values to such capitalised items.
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experience, technical evaluation, requirements of Schedule
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The aforesaid capitalisation is a significant non-recurring event
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II of the Companies Act, 2013 and our understanding of the
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for the year and accounting for the same has been identified as a
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Company's business; and
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significant risk for our audit that required significant auditor attention
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Evaluated the appropriateness and adequacy of the disclosures
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and efforts. Considering the magnitude of capital expenditure
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made in the standalone financial statements in accordance
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incurred and the significant efforts and judgement involved, we have
determined this matter to be a key audit matter for the current year
audit.
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with the applicable accounting standards.
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Impairment assessment of investments, loans and other balances
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Our
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audit procedures included, but were not limited to, the
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receivable from its subsidiaries
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following:
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Refer note 2.2(b) for material accounting policy information and
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Obtained an understanding of the management's process
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note 5, 6, 46(a) and 46(b) in notes forming part of standalone
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for identification of impairment indicators for investments,
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financial statements in relation to investments, loans and other
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loans and other balance receivable and impairment testing in
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balances receivable from its subsidiaries.
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accordance with Ind AS 36 and Ind AS 109 and evaluated the
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As at 31st March 2025, the Company has investments in subsidiaries
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design and tested the operating effectiveness of key internal
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of ? 4,204 lacs, net of provision for impairment of ? 2,246 lacs and
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financial controls relating to such process;
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loans given to and other receivables from the subsidiaries aggregates
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Evaluated the Company's accounting policies with respect to
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to ? 5,486 lacs. Such investments, loans and other receivable
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impairment assessment and assessed its compliance with the
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together constitutes 10.09% of the total assets of the Company.
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requirements of Ind AS 36 and Ind AS 109;
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At each period end, the management reviews whether any
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Obtained the management's assessment on impairment
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impairment indicators exist in the carrying amount of investments,
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indicators around the recoverability of investments, loans
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loans and other balance receivable, in accordance with the
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and other balances receivable from subsidiaries and tested
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requirements of Ind AS 36, "Impairment of Assets" ('Ind AS 36'), and
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the mathematical accuracy of the underlying calculations
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Ind AS 109, "Financial instruments" ('Ind AS 109'), as applicable.
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and traced such information to source financial information
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As at 31st March 2025, the net carrying amount of investment in a
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relating to subsidiary companies;
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subsidiary was higher than their net worth, which has been identified
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For cases where impairment indicators are present, obtained
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as an impairment indicator by the management. Accordingly,
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the impairment assessment working performed by the
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management has performed impairment test by determining the
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management's expert and tested the arithmetical accuracy of
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recoverable amount of aforesaid balances from such subsidiaries
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valuation model and traced the future cash flow projections
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using the Discounted Cash Flow ('DCF') valuation model, which
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used in such impairment assessment with the approved
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requires significant estimation and judgement around assumptions
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business plans;
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used such as projections of future cash flows, growth rates and
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Assessed the professional competence, objectivity and
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discount rates applied etc. Changes to these assumptions could lead
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capabilities of the valuation expert used by the management
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to material changes in estimated recoverable amounts, resulting in
either additional impairment or reversals of impairment taken in
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for determining recoverable amount;
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Involved auditor's valuation expert to assess the
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prior years.
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appropriateness of the valuation methodology and
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Considering the materiality and significance of the amount involved
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reasonableness of key assumptions used by management's
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and significant estimates and judgement involved in assumptions
used for the computation of the recoverable amount, we have
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valuation experts to determine recoverable amount;
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determined this matter to be a key audit matter for the current year
audit.
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Evaluated and challenged the forecasted cash flows of
subsidiaries based on our knowledge of the business and the
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markets in which they operate and assessed the comparability
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Impairment assessment of investments, loans and other balances
receivable from its subsidiaries
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of the forecasts with historical information;
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Performed sensitivity analysis of the key assumptions, including
the growth rates and discount rate applied in determining the
recoverable amount to evaluate the possible variation on the
current recoverable amount;
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Reviewed the regularity of repayment of principal and
payments of interest as per terms of the agreement relating to
loans given to the subsidiary companies; and
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Evaluated the appropriateness and adequacy of disclosures
given in the standalone financial statements in accordance
with applicable accounting standards.
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INFORMATION OTHER THAN THE STANDALONE FINANCIAL
STATEMENTS AND AUDITOR'S REPORT THEREON
6. The Company's Board of Directors are responsible for the
other information. The other information comprises the
information included in the Annual 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 will 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
identified above when it becomes available 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
communicate the matter to those charged with governance.
RESPONSIBILITIES OF MANAGEMENT AND THOSE CHARGED
WITH GOVERNANCE FOR THE STANDALONE FINANCIAL
STATEMENTS
7. The accompanying standalone financial statements have
been approved by the Company's Board of Directors. The
Company's Board of Directors are responsible for the
matters stated in section 134(5) of the Act with respect
to the preparation and presentation 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 specified
under section 133 of the Act 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 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 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.
8. In preparing the standalone financial statements, the Board
of Directors 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 the Board of Directors either
intends to liquidate the Company or to cease operations, or
has no realistic alternative but to do so.
9. 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
10. 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 Standards on Auditing 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.
11. As part of an audit in accordance with Standards on Auditing,
specified under section 143(10) of the Act 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 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 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 Board of Directors'
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; and
• 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.
12. 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.
13. 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.
14. 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.
OTHER MATTER
15. The standalone financial statements of the Company for the
year ended 31st March 2024 were audited by the predecessor
auditor, S.R. Batliboi & Co. LLP, Chartered Accountants, who have
expressed an unmodified opinion on those standalone financial
statements vide their audit report dated 14th May 2024.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
16. As required by section 197(16) of the Act, based on our audit,
we report that the Company has paid remuneration to its
directors during the year in accordance with the provisions
of and limits laid down under section 197 read with Schedule
V to the Act.
17. As required by the Companies (Auditor's Report) Order, 2020
('the Order') issued by the Central Government of India in
terms of section 143(11) of the Act we give in the Annexure
I a statement on the matters specified in paragraphs 3 and 4
of the Order, to the extent applicable.
18. Further to our comments in Annexure I, as required by
section 143(3) of the Act based on our audit, we report, to
the extent applicable, 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 purpose of our audit of
the accompanying standalone financial statements;
b) Except for the matters stated in paragraph 18(h)(vi)
below on reporting under Rule 11(g) of the Companies
(Audit and Auditors) Rules, 2014 (as amended), 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 Ind AS specified under section
133 of the Act;
e) On the basis of the written representations received
from the directors and 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 qualification relating to the maintenance of
accounts and other matters connected therewith are
as stated in paragraph 18(b) above on reporting under
section 143(3)(b) of the Act and paragraph 18(h)(vi)
below on reporting under Rule 11(g) of the Companies
(Audit and Auditors) Rules, 2014 (as amended);
g) With respect to the adequacy of the internal financial
controls with reference to financial statements of the
Company as on 31st March 2025 and the operating
effectiveness of such controls, refer to our separate
report in Annexure II wherein we have expressed an
unmodified opinion; and
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, as detailed in Note 36 to the
standalone financial statements, has disclosed
the impact of pending litigations on its financial
position as at 31st March 2025;
ii. the Company did not have any long-term
contracts including derivative contracts for which
there were any material foreseeable losses as at
31st March 2025;
iii. There were no amounts which were required
to be transferred to the Investor Education and
Protection Fund by the Company during the year
ended 31st March 2025;
iv. a. The management has represented that,
to the best of its knowledge and belief,
other than as disclosed in Note 45(5) to the
standalone financial statements, no funds
have been advanced or loaned or invested
(either from borrowed funds or securities
premium or any other sources or kind of
funds) by the Company to or in any person(s)
or entity(ies), including foreign entities ('the
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
('the Ultimate Beneficiaries') or provide any
guarantee, security or the like on behalf the
Ultimate Beneficiaries;
b. The management has represented that,
to the best of its knowledge and belief, as
disclosed in Note 45(6) to the standalone
financial statements, no funds have been
received by the Company from any person(s)
or entity(ies), including foreign entities ('the
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 such audit procedures performed
as considered reasonable and appropriate
in the circumstances, nothing has come to
our notice that has caused us to believe that
the management representations under
sub-clauses (a) and (b) above contain any
material misstatement.
v. a) The final dividend paid by the Company
during the year ended 31st March 2025 in
respect of such dividend declared for the
previous year is in accordance with section
123 of the Act to the extent it applies to
payment of dividend.
b) As stated in Note 35(ii) to the accompanying
standalone financial statements, the Board
of Directors of the Company have proposed
final dividend for the year ended 31st March
2025 which is subject to the approval
of the members at the ensuing Annual
General Meeting. The dividend declared is
in accordance with section 123 of the Act
to the extent it applies to declaration of
dividend.
vi. As stated in Note 46(c) to the standalone financial
statements and based on our examination which
included test checks, except for instances/
matters mentioned below, the Company, in
respect of financial year commencing on 1
April 2024, has 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 other
than the consequential impact of the exception
given below. Furthermore, except for instances/
matters mentioned below, the audit trail has been
preserved by the Company as per the statutory
requirements for record retention.
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Nature of exception noted
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Details of Exception
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Instances of accounting
software for maintaining
books of account for which
the feature of recording audit
trail (edit log) facility was not
operated throughout the year
for all relevant transactions
recorded in the software.
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The audit trail feature was not
enabled at the database level
for accounting software to
log any direct data changes,
used for maintenance of all
accounting records by the
Company.
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For Walker Chandiok & Co LLP
Chartered Accountants
Firm's Registration No.: 001076N/N500013
Rohit Arora
Partner
Place: Gurugram Membership No.: 504774
Date: 19th May 2025 UDIN: 25504774BMIDMC4661
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