We have audited the accompanying Standalone Financial Statements of IP RINGS LIMITED (“the Company”), which
comprise the Standalone Balance Sheet as at March 31, 2025, the Standalone Statement of Profit and Loss (including
Other Comprehensive Income), Standalone Statement of Changes in Equity and Standalone Statement of Cash flows
for the year then ended, and a summary of the material 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 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, the 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 Companies Act, 2013. 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 ICAI’s 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.
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Key Audit Matter Description
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Response to Key Audit Matter
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Revenue Recognition
Reference may be made to Note 57B(10) of material
accounting policies and Note 22 and 29 to the standalone
financial statements of the Company.
Revenue recognition is inherently an area of audit risk,
which we have focused on mainly covering the aspects
of cut off.
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Principal Audit Procedures
Our audit procedures relating to revenue comprised of
test of controls and substantive procedures including
the following:
i. We performed procedures to assess the design and
internal controls established by the management
and tested the operating effectiveness of relevant
controls related to the recognition of revenue.
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Key Audit Matter Description
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Response to Key Audit Matter
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Considering the above, impact of Ind AS 115 and cut-off
are considered by us as key audit matters.
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ii. Selected a sample of continuing and new
contracts, and tested the operating effectiveness
of the internal control, relating to identification
of the distinct performance obligations and
determination of transaction price. We carried out
a combination of procedures involving enquiry
and observation, reperformance and inspection of
evidence in respect of operation of these controls.
iii. We have tested, on a sample basis, whether specific
revenue transactions around the reporting date
has been recognised in the appropriate period by
comparing the transactions selected with relevant
underlying documentation, including goods
delivery notes, customer acknowledgement/proof
of acceptance and the terms of sales.
iv. We have also validated subsequent credit notes
and sales returns up to the date of this Report to
ensure the appropriateness and accuracy of the
revenue recognition.
v. We tested journal entries on a sample basis to
identify any unusual or irregular items.
vi. We also considered the adequacy of the disclosures
in Company’s financial statements in relation
to Ind AS 115 and were satisfied they meet the
disclosure requirements.
Conclusion
Based on the procedures performed above, we did not
find any material exceptions with regards to timing of
revenue recognition and disclosure requirement of Ind
AS 115 in the financial statements.
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Impairment in Trade Receivables
Reference may be made to Note 5 to the standalone
financial statements of the Company.
The Company is exposed to potential risk of financial
loss when there is the risk of default on receivables from
the customers for which the Management would make
specific provision against individual balances with
reference to the recoverable amount. Such provision/
allowance for credit losses is based on historical
experience adjusted to reflect current and estimated
future economic conditions.
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Principal Audit Procedures
We have performed the following procedures in relation
to the recoverability of trade receivables and computing
allowance for credit losses:
• Tested the effectiveness of the control over the
methodology for computing the allowance for
credit losses, including consideration of the
economic conditions and completeness and
accuracy of information used in the estimation of
probability of default. Tested the accuracy of aging
of trade receivables at year end on a sample basis.
• Obtained a list of outstanding receivables and
identified any debtors with financial difficulty
through discussion with management.
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Key Audit Matter Description
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Response to Key Audit Matter
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For the purpose of impairment assessment, significant
judgements and assumptions, including the credit risks
of customers, the timing and amount of realization of
these receivables, are required for the identification
of impairment events and the determination of the
impairment charge.
In view of the above, we identified allowance for credit
losses as a key audit matter since significant judgement
is exercised in calculating the expected credit losses/
impairment charge.
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• Assessed the recoverability of the unsettled
receivables on a sample basis through our
evaluation of management’s assessment with
reference to the credit profile of the customers,
historical payment pattern of customers, publicly
available information and latest correspondence
with customers and to consider if any additional
provision should be made;
• Tested subsequent settlement of trade receivables
after the balance sheet date on a sample basis.
Conclusion
Based on the above procedures we found the key
judgements and assumptions used by management
in the recoverability assessment of trade receivables
to be supportable based on the available evidence
and consequently are satisfied on the sufficiency of
provisions/allowance for credit losses.
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Allowance for inventory obsolescence
Refer to Note 4 of the standalone financial statements.
The Company holds significant inventories and records
allowance for identified and estimated inventory
obsolescence.
As at 31st March 2025, the Company had inventories of
Rs. 5,343.07 lakhs.
The Company provides for obsolescence of Inventory
considering the inventory on hand, existing/probable
customer orders, the production plan, expected
utilisation in production and expected sales. Further
the estimates are validated by technological changes/
legislative changes in the auto business and trends of
the obsolescence in the past. The obsolescence covers
inventory under Raw material, work-in-progress,
and finished goods. Given the significant judgment
involved in management’s assessment, the allowance
for inventory obsolescence is identified as a key audit
matter
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Our audit procedures in respect of this matter
included:
Understood management policy and process for
identification of providing of obsolete inventory,
including performing testing of controls to assess the
effectiveness of the same. Reviewed the management’s
judgement applied in calculating the value of inventory
obsolescence, taking into consideration the expected
changes in auto industry and management assessment
of the present and future condition of the inventory.
Assessed the adequacy of the relevant disclosure in the
notes to the financial statements
Conclusion
Based on the above procedures performed, we
consider the provision for inventory obsolescence to be
reasonable.
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Information Other than the Financial Statements and Auditor's Report Thereon
The Company’s Board of Directors is responsible for the preparation of other information in their Report to
members, etc. The other information comprises the information included in the Annual report but does not include
the consolidated financial statements, 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 auditors’ 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 or 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 and take appropriate action
as applicable under the relevant laws and regulations.
Management's Responsibility for the Standalone Financial Statements.
The Company’s Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act,
2013 (“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, total 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 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 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 are also responsible for overseeing the Company’s financial reporting process.
Auditor's Responsibilities for the Audit of the 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 control 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 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 Section143 (3) of the Companies Act, 2013, based on our audit 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, except for the matters stated in paragraph 1(i)(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 Statement of Cash Flows and the Standalone Statement of Changes in Equity 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 relevant rules issued thereunder.
e. On the basis of the written representations received from the directors 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 Section164(2) of the Companies Act, 2013.
f. The modifications relating to the maintenance of accounts and other matters connected therewith are as
stated in the paragraph 1(b) above on reporting under Section 143(3)(b) of the Act and paragraph 1(i)(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 with reference to the financial statements
of the Company and the operating effectiveness of such controls, refer to our separate report in Annexure
“A”. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the
company’s internal financial controls with reference to the financial statements.
h. With respect to the other matters to be included in the Auditor’s Report in accordance with the
requirements of Section 197(16) of the Act, as amended in our opinion and to the best of our information
and according to the explanations given to us, remuneration paid by the company to its directors during
the year is in compliance with the provisions of Section 197, read with Schedule V of the Act.
i. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11
of the Companies (Audit and Auditor’s) Rules, 2014, as amended, in our opinion and to the best of our
information and according to the explanation given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its Standalone
Financial Statements. (Refer Note 30)
ii. The company did not have any long-term contracts including derivative contracts for which there
were any material foreseeable losses as at March 31,2025.
iii. There were no amount which were 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, as disclosed in
the Note 49 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 persons or entities, 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.
(b) The Management has represented, that, to the best of its knowledge and belief, as disclosed in
the Note 49 to the accounts, 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, 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 mis-statement.
v. There was no dividend declared / paid during the year by the company.\
vi. Based on our examination which included test checks, except for the instance mentioned below, the
Company has used accounting software for maintaining its books of account, which have 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:
- The feature of recording audit trail (edit log) facility was enabled at the database level to log any
direct data changes to the accounting software only from May’2024.
Further, for the periods where audit trail (edit log) facility was enabled and operated throughout the
year for the respective accounting software, we did not come across any instance of the audit trail
feature being tampered with and Additionally, except where the audit trail (edit log) facility was not
enabled at the database level in the previous year, the audit trail has been preserved by the Company
as per the statutory requirements for record retention.
2 As required by the Companies (Auditor’s Report) Order,2020 (“the Order”) issued by the Central Government in
terms of Section 143(11) of the Act, we give in “Annexure B” a statement on the matters specified in paragraphs
3 and 4 of the Order.
For M.S.Krishnaswami & Rajan
Chartered Accountants
Registration No. 01554S
M.S. Murali
Partner
Membership No. 26453
UDIN: 25026453BMFXXI5549
May 29,2025
Chennai
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