We have audited the accompanying standalone financial statements of Mangalam Worldwide Limited ("the Company"),which comprise the balance sheet as at 31st March 2025, and the statement of Profit and Loss (including othercomprehensive income), and statement of changes in equity and statement of cash flows for the year ended 31st March2025, and notes to the financial statements, including a summary of significant accounting policies and other explanatoryinformation.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalonefinancial statements give the information required by the Companies Act, 2013, as amended ("the act") in the mannerso required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under Section133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accountingprinciples generally accepted in India, of the state of affairs of the Company as at 31 March 2025, and its profit andother comprehensive income, changes in equity and its cash flows for the year ended on that date.
We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of theCompanies Act, 2013. Our responsibilities under those Standards are further described in the 'Auditor's Responsibilitiesfor the Audit of the Standalone Financial Statements' section of our report. We are independent of the Company inaccordance with the 'Code of Ethics' issued by the Institute of Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financial statements under the provisions of the Companies Act, 2013and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirementsand the Code of Ethics.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinionon the standalone financial statements.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of thestandalone financial statements for the financial year ended 31st March 2025. These matters were addressed in thecontext of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we donot provide a separate opinion on these matters.
We have determined the following matters to be the key audit matters to be communicated in our report:
The key audit matter
How the matter was address in our audit
Revenue recognition from sale of goods (as described in Note 2.11 and 33 of the standalone financial statements)
Revenue of the Company mainly comprises of saleof goods to its customers. Revenue from sale ofgoods is recognized when control is transferred tothe customer and there is no other unfulfilledobligation. This requires detailed analysis of eachcontract/ customer purchase order regardingtiming of revenue recognition. Inappropriateassessment could lead to a risk of revenue beingrecognized on sale of goods before the control inthe goods is transferred to the customer.Accordingly, timing of recognition of revenue is akey audit matter.
We applied the following audit procedures in this area, among
others to obtain sufficient appropriate audit evidence:
• Assessed the Company's revenue recognition policy and itscompliance with Ind AS 115;
• Evaluated the design and tested the operating effectiveness ofkey controls related to timing of revenue recognition;
• Performed testing on selected samples of customer contracts/customer purchase orders. Checked terms and conditionsrelated to acceptance of goods, acknowledged delivery receiptsand tested the transit time to deliver the goods and its revenuerecognition.
• Our tests of details focused on cut-off samples to verify onlyrevenue pertaining to current year is recognized based ondelivery documents along with terms and conditions set outin customer contracts/customer purchase orders.
Inventory (as described in Note 2.8 and 13 of the standalone financial statements)
The carrying value of inventory as at 31st March2025 is Rs. 28,187.82 lakhs. The inventory is valuedat lower of cost or net realisable value afterproviding for obsolescence if any.
We considered the value of inventory as a keyaudit matter given the relative size of its balancein the financial statements and significantjudgment involved in the consideration of factorsin determination of selling prices such asfluctuation of raw materials prices in the marketand in determination of net realizable value.
We applied the following audit procedures in this area, amongothers to obtain sufficient appropriate audit evidence:
• We understood and tested the design and operatingeffectiveness of controls as established by the management indetermination of net realizable value of inventory.
• Assessing the appropriateness of Company's accounting policyfor valuation of stock-in-trade and compliance of the policywith the requirements of the prevailing Indian accountingstandards.
• We considered various factors including the actual sellingprice prevailing around and subsequent to the yea-end.
• Compared the cost of the finished goods with the estimatednet realizable value and checked if the finished goods wererecorded at net realizable value where the cost was higherthan the net realizable value.
Based on the above procedures performed, the management'sdetermination of the net realizable value of the inventory as atthe year end and comparison with cost for valuation of inventoryis considered to be reasonable.
Tax litigations and contingencies (as described in Note 2.23 and 46 of the standalone financial statements)
The Company has litigations in respect of certainmatters at various authority levels, in respect ofwhich, the company has disclosed contingentliabilities as at 31st March 2025.
The management's assessment with regard to thetax matters is supported by advice fromindependent consultants.
We considered this as a key audit matter, asevaluation of these matters requires significantmanagement judgement and estimation,interpretation of laws and regulations andapplication of relevant judicial precedents todetermine the probability of outflow of economicresources for recognising provisions and makingrelated disclosures in the financial statements.The application of accounting principles as givenunder Ind AS 37, Provisions, Contingent Liabilitiesand Contingent Assets, in order to determine theamount to be recognised as a provision, or to bedisclosed as a contingent Liability, needs carefulevaluation and judgement to be applied by themanagement.
• We evaluated and assessed and tested the design andoperating effectiveness of key controls surrounding assessmentof litigations;
• Obtaining a complete list of litigation matters and reading theunderlying orders and other communications received fromtax authorities and management's responses thereto, to assessthe status of the litigations;
• Evaluating the independence, objectivity and competence ofmanagement's experts involved;
• Reading the management's experts advice, as applicable;
• Evaluating the management's assessment on the probability ofoutcome and the magnitude of potential outflow of economicresources in respect of tax matters including involvement ofour tax experts for assessing complex tax matters, based onrecent rulings and latest developments in case laws;
• Evaluating appropriateness of the Company's disclosures inthe financial statements.
Based on the above procedures, the assessment made bymanagement in respect of disclosures made in 'contingent liabilities'relating to these matters in the standalone financial statementswas considered to be appropriate.
Carrying value of trade receivables and advances
The collectability of the Company's tradereceivables and advances (including tradeadvances), the valuation of allowance forimpairment of trade receivables and provision forbad and doubtful debt requires significantmanagement judgement. As per the currentassessment of the situation based on the internal
• Assessing the Company's policies for recognizing lossallowance for trade receivable and advances to determine thecarrying value of trade receivables and advances.
• Assessing trade receivables and advances on sample basis,
Carrying value of trade receivables and advances (Contd.....)
and external information available up to the dateof approval of these financial statements by theBoard of Directors, the Company believes that thereis no indication of any material impact on thecarrying value.
The management considers such information todetermine whether a provision for impairment orfor bad debt is required either for a specifictransaction or for a customer's balance overall.Accordingly, it has been determined as a key auditmatter.
based on its ageing along with historical trend/ pattern ofcollections received from the customers including the samereceived subsequent to year end, up to the date of completionof audit procedures.
• Evaluating management's assessment of recoverability ofoutstanding receivables through inquiry with the managementregarding disputes between the parties involved, attempts bythe management to recover the amounts outstanding and onthe credit status of significant counterparties whereveravailable.
• Assessing the appropriateness of the loss allowance for tradereceivables and advances made by the Company.
• Assessing the disclosures made by the Company in this regardin the standalone financial statements.
The Company's Board of Directors is responsible for the preparation of the other information. The other informationcomprises the information included in the Management Discussion and Analysis, Board's Report including Annexuresto Board's Report, Business Responsibility Report, Corporate Governance and Shareholder's Information, but does notinclude 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 anyform of assurance conclusion thereon.
In connection with our audit of the standalone financial statements, our responsibility is to read the other informationand, in doing so, consider whether the other information is materially inconsistent with the financial statements or ourknowledge 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.
The Company's Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to thepreparation of these standalone financial statements that give a true and fair view of the financial position, financialperformance including other comprehensive income, cash flows and changes in equity of the Company in accordancewith the accounting principles generally accepted in India, including the accounting Standards specified under section133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with theprovisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that wereoperating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparationand presentation of the standalone financial statement that give a true and fair view and are free from materialmisstatement, whether due to fraud or error.
In preparing the standalone financial statements, management is responsible for assessing the Company's ability tocontinue as a going concern, disclosing, as applicable, matters related to going concern and using the going concernbasis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, orhas no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing the Company's financial reporting process.
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole arefree 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 withSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and areconsidered material if, individually or in the aggregate, they could reasonably be expected to influence the economicdecisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticismthroughout the audit. We also:
• Identify and assess the risks of material misstatement of the standalone financial statements, whether due tofraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence thatis sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatementresulting 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 control relevant to the audit in order to design audit procedures that areappropriate in the circumstances. Under section 143(3)(i) of the Companies Act, 2013, we are also responsiblefor expressing our opinion on whether the company has adequate internal financial controls system withreference to financial statements in place and the operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates andrelated disclosures made by management.
• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based onthe audit evidence obtained, whether a material uncertainty exists related to events or conditions that may castsignificant doubt on the Company's ability to continue as a going concern. If we conclude that a materialuncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in thefinancial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are basedon the audit evidence obtained up to the date of our auditor's report. However, future events or conditions maycause the Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures,and whether the standalone financial statements represent the underlying transactions and events in a mannerthat achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing ofthe audit and significant audit findings, including any significant deficiencies in internal control that we identify duringour audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirementsregarding independence, and to communicate with them all relationships and other matters that may reasonably bethought 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 mostsignificance in the audit of the standalone financial statements for the year ended 31st March 2025 and are thereforethe key audit matters. We describe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonably be expected to outweighthe public interest benefits of such communication.
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 ofIndia in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in the 'Annexure A' astatement 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 knowledgeand 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 itappears from our examination of those books;
(c) The Balance Sheet, the Statement of Profit and Loss including the Statement of Other ComprehensiveIncome, the Cash Flow Statement and Statement of changes in Equity dealt with by this Report are inagreement with the books of account;
(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standardsspecified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rule, 2015 asamended;
(e) On the basis of the written representations received from the directors as on 31st March 2025 taken onrecord by the Board of Directors, none of the directors is disqualified as on 31st March 2025 from beingappointed 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 these standalone financialstatements and the operating effectiveness of such controls, refer to our separate Report in "Annexure B"to this report;
(g) With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 ofthe Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of ourinformation and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in itsstandalone financial statements - Refer note 46 to the standalone financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which therewere any material foreseeable losses;
iii. There were no amounts which were required to be transferred to the Investor Education andProtection Fund by the Company;
iv. (a) The management has represented that, to the best of its knowledge and belief, as disclosed
in note 60 to the standalone financial statements, no funds have been advanced or loanedor invested (either from borrowed funds or share premium or any other sources or kind offunds) 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 theIntermediary shall:
• directly or indirectly lend or invest in other persons or entities identified in anymanner whatsoever ("Ultimate Beneficiaries") by or on behalf of the Company or
• Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
(b) The management has represented, that, to the best of its knowledge and belief, as disclosedin note 60 to the standalone financial statements, no funds have been received by theCompany from any persons or entities, including foreign entities ("Funding Parties"), with theunderstanding, whether recorded in writing or otherwise, that the Company shall:
• directly or indirectly, lend or invest in other persons or entities identified in anymanner whatsoever ("Ultimate Beneficiaries") by or on behalf of the Funding Party or
• Provide any guarantee, security or the like from or on behalf of the UltimateBeneficiaries.
(c) Based on such audit procedures as considered reasonable and appropriate in thecircumstances, nothing has come to our notice that has caused us to believe that therepresentations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b)above, contain any material misstatements.
v. The dividend proposed in the previous year, declared and paid by the company during the year isin accordance with Section 123 of the Act, as applicable.
(h) With respect to the matter to be included in the Auditor's Report under Section 197(16) of the Act:
In our opinion and according to the information and explanations given to us, the remuneration paid bythe Company to its directors during the current year is in accordance with the provisions of Section 197of the Act. The remuneration paid to any director is not in excess of the limit laid down under Section197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16)of the Act which are required to be commented upon by us.
(i) Based on our examination which included test checks, the Company has used accounting software formaintaining its books of account for the year ended 31st March 2025 which has a feature of recordingaudit trail (edit log) facility and the same has operated throughout the year for all relevant transactionsrecorded in the software. Further, during the course of our audit we did not come across any instance ofaudit trail feature being tampered with in respect of the accounting software.
Chartered AccountantsFRN.: 141173W
Proprietor
Membership No.: 153774 Date : 30th April 2025
UDIN : 25153774BMIOJX7661 Place : Ahmedabad