We have audited the accompanying standalone financial statements of Bikaji Foods International Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2024, and the Statement of Profit and Loss, including Other Comprehensive Income, Statement of Changes in Equity and Statement of Cash Flows for the year then ended, and notes to the standalone financial statements, including material accounting policy information and other explanatory information (hereinafter referred to as the "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 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, 2024, and profit other 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 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 obtained by us is sufficient and appropriate to provide a basis for our opinion.
Emphasis of Matter
We draw your attention to Note 48 to the standalone financial statements in respect of the Composite Scheme of Amalgamation (the "Scheme") between the Company and Hanuman Agrofood Private Limited ("Transferor Company"). The Scheme has been approved by the Jaipur Bench of the Hon'ble National Company Law Tribunal ('NCLT') vide its order dated January 05, 2024, with an appointed date of April 01, 2022. Consequent to the merger, the accounting treatment to the Scheme has been given effect to from the appointed date instead of date required under Ind AS 103 - Business Combinations, which is the date of control establishment i.e. November 24, 2022. Accordingly, the figures for the comparative financial year have been restated to give effect to the aforesaid merger with effect from the April 01, 2022, as per the requirement of General circular no. 09/2019 dated August 21, 2019, of the Companies Act, 2013.
Our opinion is not modified in respect of this matter.
Key Audit Matter
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements for the year ended March 31, 2024. 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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Sr.
No
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Key Audit Matter
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How the Key Audit Matter was addressed in our audit
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1
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Revenue Recognition (Refer note 2.2 (B) to the standalone financial statements)
The Company recognizes revenues when control of the goods is transferred to the customer at an amount that reflects the consideration to which the Company expects to receive in exchange for those goods. In determining the sales price, the Company considers the effects of variable consideration (rebates and discounts). The terms of arrangements vary in respect to domestic and exports sales, including the timing of transfer of control, the nature of discount and rebates arrangements, delivery specifications and other contractual terms.
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Our key audit procedures around revenue recognition includes but were not limited to, the following:
1. Evaluated the appropriateness of Company's accounting policy on revenue recognition in accordance with the requirements of Indian Accounting standard 115 "Revenue from contracts with customers" ('Ind AS 115').
2. Evaluated the design, implementation and tested the operating effectiveness of the relevant key controls with respect to revenue recognition including general information and technology control environment, key IT application controls over the Company's IT systems which govern revenue recognition in the general ledger accounting system.
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Sr.
No
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Key Audit Matter
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How the Key Audit Matter was addressed in our audit
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Owing to the volume of sales transactions spread across
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3. Ensured completeness and existence assertion by
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various locations and geographies along with varied terms
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performing substantive testing on selected samples of
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of contracts with customers, there is a risk of revenue
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revenue transactions recorded during the year by testing the
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being recognized before control is transferred. Based on
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underlying documents like contracts, invoices, goods despatch
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above, revenue recognition has been considered as a key
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notes, shipping documents and customer receipts wherever
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audit matter.
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applicable and obtaining independence balance confirmation from the customers at the balance sheet date.
4. Ensured cut off assertion by reviewing the Company's revenue recognition policies, testing samples of revenue transactions near the end of the reporting period and verified shipping and billing documents to ensure that the revenue is recorded in corrected accounting period.
5. Assessed the underlying assumptions and estimates used for determination of variable consideration and tested rebates and discount provided to the customers on a sample basis, comparing the same with underlying approvals and terms of the contracts and schemes offered to customers.
6. Performed analytical procedures on revenue recognised during the year to identify and inquire on unusual variances, if any and getting the reasons for variances confirmed from the management of the Company.
7. Tested on a sample basis, manual journal entries relating to revenues identify and inquire on unusual items, if any.
8. Assessed the appropriateness and adequacy of disclosures in the standalone financial statements to ensure they are accurate, complete, and comply with the requirements of Ind AS 115 - ' Revenue from contracts with customer'.
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2
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Fair Valuation of Investments (Refer note 2.2 (S) to the
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Our key audit Procedures around fair valuation of investments
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standalone financial statements)
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includes but were not limited to, the following:
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As at March 31, 2024, the Company has total investment of
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1. Evaluated the design, implementation, and operating
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H 5,951.14 lakhs in the form of various financial instruments
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effectiveness of controls over fair valuation of investments,
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such as equity shares and optionally convertible debentures,
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including controls relating to review of future cash flow
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which are measured at fair value through statement of
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forecasts and controls relating to review of assumptions of
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profit and loss and other comprehensive income, as per
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discount rates and the long-term growth rates.
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requirements of applicable Ind AS.
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2. Obtained report of external valuation specialist appointed by
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As per fair value measurement hierarchy under Ind AS 113,
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the Management for the valuation of investment. Evaluated the
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these investments are categorised as Level 3 and accordingly
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competence and objectivity of the valuation specialist engaged
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inputs used for valuation are unobservable. The fair value is
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by the management.
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determined basis management's estimate and assumptions
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3. Together with our internal valuation experts, assessed the
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which included use of discounted cash flow model to estimate
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Company's valuation methodology applied in estimating the
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the fair value and requires management to make significant
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fair value of the Investments and the appropriateness of the
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estimates and assumptions related to future cash flow
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valuation methodology applied, and also tested reasonableness
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forecasts (including forecast of future revenue and operating
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of the assumptions around the key drivers of the cash flow
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margins], discount rates and the long-term growth rates applied to these future cash flow forecasts. Changes in these estimates and assumptions could have a significant impact on the assessment of the fair value of these investments and the
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forecasts, i.e., future growth rates, discount rates used.
4. Assessed the reasonableness of the input data for future cash flows, the historical accuracy of the Company estimates by comparing the forecasts used in the prior year model with
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consequential impact on gain/loss recognised in statement of profit and loss and other comprehensive income.
Considering the material impact of the amounts involved, and the significant degree of management judgement and subjectivity involved in the estimates and assumptions used in determining the fair values, we have determined fair valuation of such investments as a key audit matter.
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the actual performance in the current year and its ability to produce accurate long-term forecasts.
5. Evaluated the appropriateness and adequacy of disclosures in the standalone financial statements in compliance with the applicable accounting standards.
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Information Other than the Standalone Financial Statements and Auditor’s Report Thereon
The Company's Board of Directors is responsible for the other information. The other information comprises the Management report, Chairman's statement, Director's report, Business Responsibility and Sustainability Reporting etc but does not include the standalone financial statements and our auditor's report thereon. The Management report, Chairman's statement, Director's report, Business Responsibility and Sustainability Reporting etc 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 Management report, Chairman's statement, Director's report, Business Responsibility and Sustainability Reporting etc, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance under SA 720 'The Auditor's responsibilities Relating to Other Information'.
Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements
The Company's Board of Directors is responsible for the matters stated in section 134(5] of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Act. 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 statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, the 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 the Board of Directors 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.
We give in "Annexure A" a detailed description of Auditor's responsibilities for Audit of the Standalone Financial Statements.
Other Matter
The restated standalone special purpose financial statements of the Company for the year ended March 31, 2023, were audited by one of the joint auditors, M Surana & Company, Chartered Accountants, whose report dated May 22, 2024 expressed an unmodified opinion on those statements.
Our opinion is not modified in respect of this matter
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 "Annexure B" 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 except for the matters stated in the paragraph 2(h](vi] below on reporting under Rule 11(g].
(c] The Balance Sheet, the Statement of Profit and Loss including other comprehensive income, the Statement of Changes in Equity and the Statement of Cash Flow dealt with by this Report are in agreement with the books of account.
(d] In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act.
(e] On the basis of the written representations received from the directors as on March 31, 2024 taken
In regard to the MARG software:
Based on our examination, the Company has used an accounting software for maintaining its books of account pertaining to accounting transactions recorded during the year ended March 31, 2024, which has a feature of recording audit trail (edit log) facility. Further, the audit trail feature was enabled at the application level and at the database level to log any direct data changes. However, we are unable to verify whether the audit trail feature has been operated throughout the year for all relevant transactions recorded in the accounting software during the year ended March 31, 2024, and also, were unable to comment as to whether there were any instances of the audit trail feature been tampered with.
In regard to the HRMS software:
Based on our examination, the Company has used an software for maintaining its books of accounts pertaining to payroll processing during the year ended March 31, 2024, which is operated by a third-party software service provider. The software has a feature of recording audit trail (edit log) facility, which has been enabled during the year for all relevant transactions at the
on record by the Board of Directors, none of the directors are disqualified as on March 31, 2024 from being appointed as a director in terms of Section 164 (2) of the Act.
(f) With respect to the adequacy of the internal financial controls with reference to standalone financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure C".
(g) The reservation relating to the maintenance of accounts and other matters connected therewith are as stated in paragraph 2(b) above on reporting under Section 143(3)(b) and paragraph 2(h)(vi) below on reporting under Rule 11(g).
(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, 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 37 to the standalone 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. (1) The Management has represented that,
to the best of its knowledge and belief, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other persons or entities, including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, 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.
(2) The Management has represented, that, to the best of its knowledge and belief, no funds have been received by the Company from any persons or entities, including foreign entities (Funding Parties), with the understanding, whether recorded in writing or otherwise, as on the date of this audit report, 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.
(3) Based on the audit procedures performed that have been considered reasonable and appropriate in the circumstances, and according to the information and explanations provided to us by the Management in this regard nothing has come to our notice that has caused us to believe that the representations under subclause (i) and (ii) of Rule 11(e) as provided under (1) and (2) above, contain any material mis-statement.
v. The final dividend paid by the Company during the year in respect of the same declared for the previous year is in accordance with section 123 of the Companies Act 2013 to the extent it applies to payment of dividend. However, the dividend amount of H 0.49 lakhs is unclaimed and yet to be paid on the date of this audit report.
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 declared is in accordance with section 123 of the Act to the extent it applies to declaration of dividend. (Refer Note 43(b) to the Standalone financial statements).
vi. In regard to the Microsoft Dynamic Software:
Based on our examination, the Company has used an accounting software for maintaining its books of account pertaining to accounting transactions recorded during the year ended March 31, 2024, which has a feature of recording the audit trail (edit log) facility, except that the audit trail feature was enabled for certain relevant transactions at the database level only with effect from February 13, 2024 to log any direct data changes.
Further, the audit trail feature has been operated throughout the year for all relevant transactions recorded in the accounting software at application level, however, the audit trail feature has been operated only from February 13, 2024 to March 31, 2024 for certain relevant transactions recorded in this accounting software at the database level. Also, during the course of our examination, we did not come across any instance of audit trail feature being tampered with, in respect of the accounting software for the period for which the audit trail was enabled and operating.
application level and at database level to log any direct data changes.
However, in the absence of independent service auditors report, we are unable to comment whether the software operated throughout the year for all relevant transactions recorded in the software during the year ended March 31, 2024. Further, we are unable to comment as to whether there were any instances of the audit trail feature been tampered with.
As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from April 01, 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 on preservation of audit trail as per the statutory requirements for record retention is not applicable for the financial year ended March 31, 2024.
3. In our opinion, according to information, explanations given to us, the remuneration paid by the Company to its directors is within the limits laid prescribed under Section 197 read with Schedule V of the Act and the rules thereunder.
For M Surana & Company For M S K A & Associates
Chartered Accountants Chartered Accountants
ICAI Firm Registration No.:015312C ICAI Firm Registration No.: 105047W
Manish Surana Manish P Bathija
Partner Partner
Membership No.: 077597 Membership No.: 216706
UDIN: 24077597BKBUIH7195 UDIN: 24216706BKGECD7661
Place: Gurugram Place: Gurugram
Date: May 23, 2024 Date: May 23, 2024
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