We have audited the accompanying standalone financial statements of I G Petrochemicals Limited ("the Company”), which comprise the Balance Sheet as at 31st March, 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 policies 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 31st March, 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.
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 for the year ended 31st March, 2024 (current year). 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 matter described below to be the key audit matter to be communicated in our report.
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Sr. No. 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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Property, Plant and Equipment and Capital work-in-
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Our audit procedures in respect of this area, among others, included the
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progress (Refer Note 2 and 3 of the Standalone Financial
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following:
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Statement)
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• Evaluated the Company's material accounting policies pertaining to
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During the year, the Company has capitalised Phthalic
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Property, Plant and Equipment and assessed compliance of the same
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Anhydride Plant ("asset") aggregating to ? 33,513 lakhs,
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in accordance with the requirements of Ind AS 16 "Property, Plant and
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reflected as total value of additions in Property, Plant and
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Equipment”.
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Equipment based on recognition criteria specified in Ind AS
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• Obtained an understanding, evaluated the design, implementation
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16, Property, Plant and Equipment.
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and tested the operating effectiveness of key controls related to
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The above mentioned, capitalisation involves following
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various capital expenditure and capitalisation of assets.
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factors requiring significant auditor's attention:
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• Performed substantive testing of the direct and indirect costs
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i. Significance of amount capitalised during the year
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capitalised, on a test check basis, with the underlying supporting
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ended 31st March, 2024 and materiality in the context
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documents to ascertain nature of costs and basis for allocation and
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of the Standalone Balance Sheet of the Company.
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evaluated whether they meet the recognition criteria provided in the
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ii. Significant Judgement required by management in
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Ind AS 16 "Property, Plant and Equipment”.
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assessing when the assets meets the recognition
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• Performed verification of other costs debited to Statement of Profit
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criteria set out in Ind AS 16 "Property, Plant and
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and Loss account, on a sample basis, to ascertain whether these
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Equipment”.
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meet the criteria for capitalisation.
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iii. Significant Judgement and estimation involved in
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• Verified the borrowing cost capitalised during the year is in accordance
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determining the eligibility of various elements of costs
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with the accounting policy of the company and Ind AS 23 "Borrowing
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including borrowing cost to be capitalised. This involves
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Cost”.
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assessment of the classification of capital and revenue
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• For the asset capitalised during the year, we have obtained the project
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expenditure and ensuring the inclusion of other directly
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completion certificate provided by the management to determine
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attributable costs for capitalisation as per the criteria
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whether the asset is in the location and operating in condition
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set out in Ind AS 16 "Property, Plant and Equipment”.
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necessary for it, to in the manner intended by the management.
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iv. Inappropriate timing of capitalisation of the project and/
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• Ensured the identification of significant parts of Property, Plant and
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or inappropriate classification of categories of items of
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Equipment that are depreciated separately is in accordance with Ind
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Property, Plant and Equipment could result in material
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AS 16 "Property, Plant and Equipment” and verified the useful life
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misstatement of Capital work-in-progress/ Property,
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considered for calculation of depreciation charge and
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Plant and Equipment with a consequent impact on depreciation charge and profit for the year.
In view of above, the above matter has been identified as a key audit matter.
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• Assessed the adequacy and appropriateness of the disclosures made by the management is in accordance with Ind AS 16 "Property, Plant and Equipment”.
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(Refer Note 2 and 3 of Standalone Financial Statements)
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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 information included in the Board's Report and Corporate Governance Report but does not include the standalone financial statements and our auditor's 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 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. 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. We have nothing to report in this regard.
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.
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.
(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 31st March, 2024 taken on record by the Board of Directors, none of the directors are disqualified as on 31st March, 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) 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 39 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, as disclosed in the Note 57(v) to the standalone financial statements, 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 person(s) or entity(ies), 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 person(s) or entity(ies), 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 sub-clause (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.
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 45 to the Standalone financial statements)
vi. Based on our examination, the Company has used an accounting software for maintaining its books of account which have a feature of recording audit trail (edit log) facility. The audit trail feature has been operated throughout the year for all transactions recorded in the accounting software. Further, during the course of our audit, we did not come across any instance of the audit trail feature being tampered with.
As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from 1st April, 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 31st March, 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 S K A & Associates For S M M P & Company
Chartered Accountants Chartered Accountants
Firm's Registration No.: 105047W Firm's Registration No.: 120438W
Siddharth Iyer Chintan Shah
Partner Partner
Membership No.: 116084 Membership No.: 166729
UDIN: 24116084BKCOAX4508 UDIN: 24166729BKCPXU2974
Place: Mumbai Date: 22nd May, 2024
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