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Sr.
No.
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Key Audit Matter
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Auditors' Response
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1. .
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Litigations, Provisions and Contingent Liabilities
There are several litigations pending before various forums
by and against the Company. These also include matters
under various statutes and involves significant management
judgement and estimates on the possible outcome of the
litigations and consequent provisioning thereof or disclosure
as contingent liabilities.
We identified this as a key matter as the estimate of these
amounts involves a significant degree of management
judgement and high estimation uncertainty.
(Refer Note 53 to the Standalone Financial Statements)
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To address this key audit matter, our procedures included:
. Obtaining from the management details of all litigations and
matters under dispute including ongoing and completed tax
assessments, demands;
. Evaluation and testing of the design of internal controls
followed by the Company relating to litigations, open tax
positions for direct and indirect taxes and other matters and
process followed to decide provisioning for the said liabilities
or disclosure as Contingent Liabilities;
* Discussing with Company's legal and taxation team for
an understanding of on-going and potential legal matters
impacting the Company and the possible outcomes for the
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same;
• We also involved our firm's internal experts to evaluate
the management's underlying judgements in making their
estimates with regard to such matters;
• We also verified the disclosures of the aforesaid matters in
terms of the applicable Ind AS.
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Sr.
No.
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Key Audit Matter
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Auditors' Response
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2.
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IT systems and controls over financial reporting.
We identified IT systems and controls over financial
reporting as a key audit matter since the Company operates
through multiple divisions, and occurrence of inter¬
division transactions and balances which are reconciled
manually. A significant portion of the Company's financial
reporting depends on the integrity and reliability of its
IT systems. While systems are in place to handle large
transaction volumes, many critical processes are manual.
The Company's IT environment consists of multiple, non¬
integrated systems across different functions and business
units. This lack of integration requires significant manual
efforts to transfer data between systems.
Automated accounting procedures and IT environment
controls, which include IT governance, IT general controls
over program development and changes, access to
program and data and IT operations, IT application controls
and interfaces between IT applications are required to be
designed to operate effectively to ensure accurate financial
reporting.
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In view of the significance of the matter, we applied the following
audit procedures among others, to obtain sufficient and
appropriate audit evidence:
* Assessed the complexity of the IT environment through
discussion with the IT team and identified IT applications that
are relevant to our audit;
• Evaluated the operating effectiveness of IT general controls
over program development and changes, access to program
and data and IT operations;
. Performed IT-Dependent Manual Controls Testing;
* Performed inquiry procedures with the IT team of the
Company in respect of the overall security architecture and
any key threats addressed by the Company in the current
year;
• Evaluated the operating effectiveness of IT application
controls in the key processes impacting financial reporting of
the Company;
. Assessed the operating effectiveness of controls relating
to data transmission through the different IT systems to the
financial reporting systems;
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* Checked the interunit balances and their reconciliation across
the divisions at year end and ensured that the inter unit
balances are zero at the year end.
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We have audited the accompanying Standalone Financial
Statements of APAR Industries 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), the Standalone Statement of
Changes in Equity and the Standalone Statement of Cash Flows
for the year then ended and notes to the Standalone Financial
Statements, including a summary of material accounting policies
and other explanatory information (hereinafter referred to 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
March 31, 2025 the net profit 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 Auditors' 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 independence requirements that are relevant to our audit
of the Standalone 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 opinion on the Standalone
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 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.
INFORMATION OTHER THAN THE
STANDALONE FINANCIAL STATEMENT AND
AUDITORS' REPORT THEREON
The Company's Management and Board of Directors is
responsible for the Other Information. The Other Information
comprises the information included in the Management
Discussion and Analysis, Board's Report including Annexures
to that Board's Report, Business Responsibility and Sustainability
Report, Corporate Governance and Shareholder's Information,
but does not include the Standalone Financial Statements,
Consolidated Financial Statements, and our Auditors'
report thereon.
Our opinion on the Standalone Financial Statements does not
cover the Other Information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the Standalone Financial
Statements, our responsibility is to read the Other Information
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 audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that
there is a material misstatement of this other information,
we are required to report that fact. When we read the other
information, 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
The Company's Management and Board of Directors are
responsible for the matters stated in Section 134(5) of the
Companies Act, 2013 with respect to the preparation of
these Standalone Financial Statements that give a true and
fair view of the financial position, financial performance
(including other comprehensive income), changes in equity
and cash flows of the Company in accordance with the Ind
AS and other accounting principles generally accepted in
India, including the accounting Standards specified under
Section 133 of the Companies Act, 2013. This responsibility
also includes maintenance of adequate accounting records in
accordance with the provisions of the Companies Act, 2013 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
judgements 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, the
Management and 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 management either
intends to liquidate the Company or to cease operations, or has
no realistic alternative but to do so;
The Management and the Board of Directors are also responsible
for overseeing the Company's financial reporting process;
AUDITORS' RESPONSIBILITIES 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 Auditors' 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 judgement and maintain professional scepticism
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 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 and Board
of Directors;
• Conclude on the appropriateness of Management and
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 Auditors' 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 Auditors' 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 Auditors' 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 (Auditors' Report) Order,
2020 ("the Order"), issued by the Central Government of
India in terms of sub-Section (11) of Section 143 of the
Companies Act, 2013, we give in the "Annexure A", a
statement on the matters specified in paragraphs 3 and 4
of the Order, to the extent applicable.
2. As required 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 Changes in Equity and the Cash Flow
Statement dealt with by this Report are in agreement
with the relevant books of account.
(d) In our opinion, the aforesaid Standalone Financial
Statements comply with the Indian 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 March 31, 2025 taken
on record by the Board of Directors, none of the
directors is disqualified as on March 31, 2025 from
being appointed as a director in terms of Section
164(2) of the Act.
(f) With respect to the adequacy of the internal financial
controls over financial reporting of the Company
and the operating effectiveness of such controls,
refer to our separate Report in "Annexure B".
Our report expresses an unmodified opinion on
the adequacy and operating effectiveness of the
Company's internal financial controls with reference
to Standalone Financial Statements.
(g) With respect to the other matters to be included in the
Auditors' 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, the
remuneration paid by the Company to its directors
during the year is in accordance with the provisions of
Section 197 read with Schedule V to the Companies
Act, 2013.
(h) With respect to the other matters to be included in
the Auditors' Report in accordance with Rule 11 of
the Companies (Audit and Auditors) Rules, 2014, 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
53 to the Standalone Financial Statements;
ii. The Company did not have any long-term
contracts including derivatives 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. i. The Management has represented that,
to the best of its knowledge and belief,
(Refer Note No. 58(v)) no funds (which
are material either individually or in
aggregate) 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(s) or entity(ies), including
foreign entities ("Intermediaries"), with
the understanding, whether recorded in
writing or otherwise, that the Intermediary
shall, whether, directly or indirectly lend or
invest in other persons or entities identified
in any manner whatsoever by or on behalf
of the Company ("Ultimate Beneficiaries")
or provide any guarantee, security or the
like on behalf of the Ultimate Beneficiaries;
ii. The Management has represented, that, to
the best of its knowledge and belief, (Refer
Note No. 58(vi)) no funds (which are
material either individually or in aggregate)
have been received by the Company from
any person(s) or entity(ies), including
foreign entities ("Funding Parties"), with
the understanding, whether recorded in
writing or otherwise, that the Company
shall, whether, directly or indirectly, lend
or invest in other persons or entities
identified in any manner whatsoever by or
on behalf of the Funding Party ("Ultimate
Beneficiaries") or provide any guarantee,
security or the like on behalf of the Ultimate
Beneficiaries; and
iii. Based on such audit procedures that
we have 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) contain
any material misstatement;
v. The final dividend paid by the Company during
the year in respect of F.Y 2023-2024 is in
accordance with Section 123 of the Act to the
extent it applies to payment of Dividend;
As stated in Note no. 21 to the Financial
Statements, the Board of Directors of the
Company have proposed final dividend for
the year which is subject to the approval of
the members at the ensuing Annual General
Meeting. The dividend proposed is in
accordance with Section 123 of the Act to the
extent it applies to declaration of dividend;
vi. Based on our examination, which included test
checks, the Company has used accounting
software for maintaining its books of account
which has the feature of recording audit trail
(edit logs) facility and the same has operated
throughout the year for all relevant transactions
recorded in the respective software. Further,
during the course of our audit we did not come
across any instances of audit trail feature being
tampered with. Additionally, the audit trail has
been preserved by the Company as per the
statutory requirement for record retention.
For C N K & Associates LLP
Chartered Accountants
Firm Registration No.: 101961W/W-100036
Himanshu Kishnadwala
Partner
Place: Mumbai Membership No.: 037391
Date: May 14, 2025 UDIN: 25037391BMLFUK2388
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