We have audited the accompanying financial statements of Paragon Finance Limited (“the
Company”),(CIN: L65921WB1986PLC040980) which comprise the Balance Sheet as at 31st
March, 2024, the Statement of Profit and Loss (including Other Comprehensive Income), the
Statement of Changes in Equity and the Cash Flow Statement for the year then ended, and a
summary of the significant 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 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 accounting principles
generally accepted in India including Indian Accounting Standards (‘Ind AS’) specified under
section 133 of the Act, of the state of affairs (financial position ) of the Company as at March 31,
2024, and its profit (financial performance including 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 financial statements in accordance with the Standards on Auditing
specified under section 143(10) of the Act (SAs). Our responsibilities under those Standards 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 independence requirements that
are relevant to our audit of the financial statements under the provisions of the Act and the Rules
made 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 audit opinion on the 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 financial statements of the current period. There 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 to be communicated in our report.

Principal Audit Procedures

We have performed the following audit procedures in order to obtain sufficient audit evidence:

• Evaluated the design of internal controls and tested the operating effectiveness of key internal
controls around the process of preparation of Financial Statements,

• Reviewed the exemptions availed by the Company from certain requirements under Ind AS,

• Obtained an understanding of the governance over the determination of key judgments,

• Evaluated and tested the key assumptions and judgments adopted by management,

• Assessed the disclosures made against the relevant Ind AS, and

• Determined the appropriateness of the methodologies and models used along with the
responsibility of the outputs.

Information other than the Financial Statement and Auditor’s Report thereon

The Company’s Board of Directors are responsible for the other information. The other information
comprises the information included in the Company’s annual report, but does not include the
financial statements and our auditors’ 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 and, in doing so, consider whether the other information is materially inconsistent with
the 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 financial statements that give a true and fair view of the state
of affairs (financial position), profit or loss (financial performance including other comprehensive
income), changes in equity and cash flows of the Company in accordance with the accounting
principles generally accepted in India, including the Indian Accounting Standards (Ind AS) 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 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 financial statements that give a true and fair view and are free
from material misstatement, whether due to fraud or error.

In preparing the financial statement, 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 responsible for overseeing the Company’s financial reporting process.
Auditor’s Responsibility for the Audit of the Financial Statements

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 the 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 the users
taken on the basis of these financial statements.

As a 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 financial statements, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and to 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 financial controls 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 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 financial statements
or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on
the audit evidence obtained upto 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 presentations, 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.

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 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 disclosures 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 section 197(16) of the Act, we report that the Company has paid remuneration to
its directors during the year in accordance with the provisions of and limits laid down under
section 197.

2. As required by the Companies (Auditor's Report) Order, 2020 issued by the Central Government
of India in terms of sub-section (11) of section 143 of the Act [hereinafter referred to as the
Order], we give in the Annexure ‘A’a statement on the matters specified in paragraphs 3 and 4 of
the order.

3. 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 financial statements 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
(Ind AS) specified under Section 133 of the Act.

(e) On the basis of the written representations received from the directors and taken on record by the
Board of Directors, none of the directors is 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 financial
statements of the Company and the operating effectiveness of such controls, refer to our
separate Report in ‘Annexure B’.

(g) With respect to the matter to be included in the Auditors’ Report under section 197(16):

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 provision
of Section 197 of the Act.

(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 litigation and its impact on financial
position in the financial statement.

(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.

(iv) (a) The Management has represented that, to the best of its knowledge and belief, as
disclosed in Note No. 28(g) of the Financial Statements, no funds (which are material
either individually or in the 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 or entity, including foreign entity
(“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. 28(h) of the Financial Statements, no funds (which are material
either individually or in the aggregate) have been received by the Company from any
person or entity, including foreign entity (“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;

(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 misstatement.

(v) The Company has not declared or paid any dividend during the year.

(vi) Based on our examination, which included test checks, the Company has used
accounting software for maintaining its books of account for the financial year ended
March 31, 2024 which has a feature of recording audit trail (edit log) facility, however
the same has not operated throughout the year for all relevant transactions recorded in
the respective software but only from 6th April, 2023 to 31st March, 2024. Further,
from 6th April, 2023 to 31st March, 2024 where audit trail (edit log) facility was
enabled, we did not come across any instance of the audit trail feature being tampered
with during the course of our audit.

As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from
April 1, 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.

For, MANDAWEWALA & CO.

Chartered Accountants
Firm Reg. No. : 322130E

Place: Kolkata

Dated: The 25th day of May, 2024. Sd/-

[CA. ANIL KR. MANDAWEWALA]
Partner

Membership No. 055939
UDIN: 24055939BKILIJ5840