1. We have audited the accompanying financial
statements of Shyam Century Ferrous Limited ("the
Company"), which comprise the Balance sheet
as at March 31, 2025, the Statement of Profit and
Loss (including Other Comprehensive Income),
the Statement of Cash Flows and the Statement
of Changes in Equity for the year then ended,
and notes to the financial statements, including a
summary of material accounting policies 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 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, its loss
and other comprehensive income, changes in equity
and cash flows for the year then ended.
Basis for Opinion
3. We conducted our audit of the financial statements
in accordance with the Standards on Auditing (SAs)
specified under section 143(10) of the Act. Our
responsibilities under those SAs are further described
in the Auditor's Responsibilities for the Audit of the
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
financial statements under the relevant provisions of
the Act and 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 financial statements.
Key Audit Matters
4. Key audit matters are those matters that, in our
professional judgment, were of most significance in
our audit of the financial statements of the current
period. These matters were addressed in the context
of our audit of the 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:
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S.
No.
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Description of Key Audit Matters
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How our audit addressed the Key Audit Matter
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1.
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Revenue Recognition
(Refer Note no. 24 to the Financial Statements and
Note 1.17 (A) of the material accounting policies of
the Financial Statements).
The Company recognizes revenue when the
Company performs its obligation and control
of the goods is transferred to the customer at an
amount that reflects the consideration to which the
Company expects to be entitled in exchange for
those goods. Delivery occurs when the product has
been dispatched to the specific location and the
risk of obsolescence / loss has been transferred and
there is no unfulfilled obligation that could affect the
buyer's acceptance of the product as per the terms
of the contract and no significant uncertainty exists
regarding the amount of the consideration that will
be derived from the sale of goods.
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Our principal audit procedures to assess the
appropriateness of revenue recognised included the
following:
• Obtained an understanding of and evaluated the
design, implementation and operating effectiveness
of the Company's key internal controls over the
revenue recognition process.
• Evaluated the appropriateness of the Company's
accounting policy for revenue recognition as per
requirements of Ind AS 115 "Revenue from Contracts
with Customers".
• End to end checking of sample sales transaction and
tracing the same to sales order, invoices, customers'
lorry receipts and collection from debtors to determine
whether these were recorded appropriately.
• Read, analyzed and identified the distinct performance
obligations in selected sample contracts.
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S.
No.
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Description of Key Audit Matters
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How our audit addressed the Key Audit Matter
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Revenue is recognised based on the price and
as per terms specified in the contracts, net of the
estimated volume discounts. Revenue is only
recognised to the extent that it is highly probable
that a significant reversal will not occur.
The terms of sales arrangements, including
the timing of transfer of control, the nature of
discount and rebates arrangements and delivery
specifications, create complexity and judgment in
determining sales revenues and accordingly, it was
determined to be a key audit matter in our audit of
the financial statements of the Company.
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• Obtained management's calculations for discounts
and rebates.
• Examined significant contracts entered into close to
year end to ensure revenue recognition is made in the
correct period.
Our testing as described above showed that revenue has
been recorded in accordance with the terms of applicable
contracts and accounting policy in this area.
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2.
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Litigations, Claims and Contingent Liabilities
(Refer Note no. 42 to the Financial Statements and
Note 1.21 of the material accounting policies of the
Financial Statements).
The Company is subject to certain legal, regulatory
and tax cases for which final outcome cannot
be easily predicted and which could potentially
result in significant liabilities. The Company's
management has assessed that the probability of
success of the demand is remote and accordingly
has not provided for the disputed demands.
The assessment of whether a liability is recognized
as a provision or disclosed as a contingent liability
in the financial statements is inherently subjective
and requires significant management judgement
in determination of the cash outflows from the
business, interpretation of applicable laws and
regulations and careful examination of pending
assessments at various levels of regulatory
authorities. These estimates could change
significantly over time as new facts emerge and
each legal case progresses.
This has been considered as a key audit matter in
view of the uncertain outcome of the litigations
and involvement of significant management
interpretations and judgement in assessing the
probability of outflow of economic resources.
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Our principal audit procedures to assess the
appropriateness of provisions and adequacy of
disclosures included the following:
• Gained an understanding of outstanding litigations
against the Company from the Company's in-house
legal counsel and other key managerial personnel
who have knowledge of these matters.
• Reviewed the outstanding litigations against the
Company for consistency with the previous years.
Enquired and obtained explanations for movement
during the year.
• Read the correspondence from Court authorities and
considered legal opinion obtained by the Company
from legal counsel.
• Examined the Company's legal expenses and read the
minutes of the board meetings, in order to ensure all
cases have been identified.
• With respect to tax matters, discussed with the
Company's tax officers, their views and strategies
on significant cases, as well as the related technical
grounds relating to their conclusions based on
applicable tax laws.
• Considered the adequacy and completeness of the
Company's disclosures with regard to those matters
where management concluded that no provisions
should be recorded.
On the basis of the above procedures performed, we
considered the management's assessment in respect
of contingencies and provision for taxes and other
litigations and claims to be reasonable and disclosures to
be appropriate.
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Information Other than the financial
statements and Auditor's Report Thereon
5. The Company's Board of Directors is responsible
for the other information. The other information
comprises the information included in the Board's
Report including Annexures to Board's Report,
Management Discussion Analysis, and Report on
Corporate Governance, but does not include the
financial statements and our auditor's report thereon.
Our opinion on the 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 financial
statements, our responsibility is to read the other
information identified above and, in doing so,
consider whether the other information is materially
inconsistent with the financial statements or our
knowledge obtained during the course of our 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
financial statements
6. 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 financial
statements that give a true and fair view of the
financial position, financial performance, including
other comprehensive income, cash flows and
changes in equity of the Company in accordance
with the accounting principles generally accepted
in India, including the Indian Accounting Standards
specified under section 133 of the Act, read with
relevant rules issued thereunder. 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
the design, implementation and maintenance of
adequate internal financial controls with reference to
financial statements 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.
7. In preparing the 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 is also responsible for
overseeing the Company's financial reporting
process.
Auditor's Responsibilities for the Audit of the
financial statements
8. Our objectives are to obtain reasonable assurance
about whether the 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 financial statements.
9. As part of an audit in accordance with SAs, we exercise
professional judgment and maintain professional
skepticism throughout the audit. We also:
Ý Identify and assess the risks of material
misstatement of the 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.
Ý 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 system with reference
to financial statements in place and the operating
effectiveness of such controls.
Ý Evaluate the appropriateness of accounting
policies used and the reasonableness of
accounting estimates and related disclosures
made by the management.
Ý 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 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.
Ý Evaluate the overall presentation, structure and
content of the financial statements, including the
disclosures, and whether the financial statements
represent the underlying transactions and events
in a manner that achieves fair presentation.
10. 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.
11. 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.
12. From the matters communicated with those charged
with governance, we determine those matters that
were of most significance in the audit of the 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
13. 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 the "Annexure A"
statement on the matters specified in paragraphs 3
and 4 of the Order, to the extent applicable.
14. 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 Cash Flows and the Statement
of Changes in Equity dealt with by this Report are
in agreement with the books of account.
(d) In our opinion, the aforesaid financial statements
comply with the Indian Accounting Standards
Specified under Section 133 of the Act, read with
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 Section 164 (2) of the Act.
(f) With respect to the adequacy of the internal
financial controls with reference to financial
statements of the Company and the operating
effectiveness of such controls, refer to our
separate Report in "Annexure B" wherein we have
expressed an unmodified opinion.
(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, as amended, 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 financial statements-Refer Note No.42
to the 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 were no amounts which were required
to be transferred to the Investor Education
and Protection Fund by the Company during
the year ended March 31, 2025
iv. (a) The Management has represented that,
to the best of its knowledge and belief,
as disclosed in Note No. 50 (i) to the
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, 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;
(b) The Management has represented,
that, to the best of its knowledge and
belief, as disclosed in Note No. 50(ii) to
the financial statements, 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, 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; 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 (i) and (ii) of Rule(e), as
provided under (a) and (b) above, contain
any material misstatement.
v. The Board of Directors of the Company have
not proposed/ paid any dividend for the year
ended March 31, 2025, hence, no compliance
of section 123 of the Act was required.
vi. Based on our examination, which included
test checks, and other generally accepted
audit procedures performed by us, we report
that the Company 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
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. Additionally,
the audit trail has been preserved by the
Company as per the statutory requirement
for the record retention.
15. 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 according to the information and
explanations given to us, the remuneration paid by
the Company to its directors during the current year
is in accordance with the provisions of Section 197 of
the Act.
For D K Chhajer & Co.
Chartered Accountants
Firm Registration No. 304138E
Jagannath Prosad Mohapatro
Partner
Place: Kolkata Membership No. 217012
Date: May 21, 2025 UDIN: 25217012BMLCKE7324
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