bal pharma Auditors report

To the Members of Bal Pharma Limited

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the standalone financial statements of Bal Pharma Limited (“the Company”), which comprise the balance sheet as at 31st March 2023, and the statement of Pro t 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 financial statements, including a summary of 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 standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2023, and profit (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 in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the

Auditors 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 together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Companies Act, 2013 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 we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matter

We draw attention to Note 62 regarding recoverability of outstanding

receivables from the subsidiary companies.

Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters (‘KAM) are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. 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.

Key Audit Matters	How our audit addressed the key audit matter
Identi cation and disclosures of Related Parties: (as described in Note-57 of the Standalone Ind AS financial statements)	Our audit procedures amongst others included the following:
l The Company has related party transactions which include, amongst others, sale, and purchase of goods/ services to its subsidiaries and other related parties and lending, investing, and borrowing to its subsidiaries and other related parties.	l Evaluated the design and tested the operating effectiveness of controls over identi cation and disclosure of related party transactions.
l We focused on identi cation and disclosure of related parties in accordance with relevant accounting standards and hence considered it as a key audit matter.	l Obtained a list of related parties from the Companys Management and traced the related parties to declarations given by directors, where applicable, and to Note 57 of the standalone Ind AS financial statements.
	l Veri ed the minutes of the meetings of the Board of Directors and Audit Committee
	l Tested material creditors/debtors, loan outstanding/ loans taken to evaluate existence of any related party relationships: tested transactions based on declaration of related party transactions given to the Board of Directors and Audit Committee
	l Evaluated the disclosures in the Standalone Ind AS financial statements for compliance with Ind AS 24, compliance with Companies Act 2013 and determining the audit reporting required under CARO.

 

Key Audit Matters	How our audit addressed the key audit matter
Inventory	l Reviewed the managements process for ensuring that there was no movement of stock during the physical veri cation of inventory.
l As of 31 March 2023, the Company held inventories of Rs 9,768.75 Lakhs as disclosed in Note 10 to the Standalone financial statements. Inventories mainly consist of raw and packing material, work-in-progress, stock-in-trade, finished goods and stores, spares and consumables.	l We understood and tested the design and operating effectiveness of controls as established by the management in determination and identi cation of returned stock nearing expiry, and the stock lying at different locations.
l We considered the value of the inventory as a key audit matter given the relative size of the balance in the financial statements and signi cant judgement involved in the consideration of various factors involved in determination of cost or selling prices	l We Assessed the appropriateness of Companys accounting policy for valuation of stock-in- trade and compliance of the policy with the requirements of the prevailing accounting standards. We considered various factors including the actual selling price prevailing around and subsequent to the year-end. Compared the cost of the finished goods with the estimated net realizable value and checked if the finished goods were recorded at net realizable value where the cost was higher than the net realizable value. For the purpose of determination of cost, the company has considered the prevailing market situation.
	l Based on the above procedures performed, by the management for determination of expired stock, the net realizable value of the inventory as at the year end, the methodology adopted for arriving at cost and comparison with cost for valuation of inventory is considered to be reasonable

 

Contingencies, including litigations and tax	l We obtained a list of ongoing litigations from the Companys in- house legal counsel. We selected a sample of litigations based on materiality and performed inquiries with the said counsel on the legal evaluation of these litigations. We compared the evaluation with the provision or disclosure in the standalone nancial statements. We tested the underlying computation of the management in relation to the measurement of the contingency.
l The Company is involved in disputes, lawsuits, claims, governmental and / or regulatory inspections, inquiries investigations and proceedings, including tax and commercial matters that arise from time to time in the ordinary course of business. Most of the claims involve complex issues. The Company assisted by their external legal counsel assesses the need to disclose a contingency on a case- to case basis considering the underlying facts of each litigation.	l We inspected relevant communication with tax authorities. We also evaluated the disclosures made in the standalone nancial statements.
l This area is significant to our audit, since the accounting and disclosure for contingent legal and tax liabilities is complex and judgmental (due to the dif culty in predicting the outcome of the matter and estimating the potential impact if the outcome is unfavorable), and the amounts involved are, or can be, material to the standalone nancial.

Information Other than the Financial Statements and

Auditors Report Thereon

The Companys management and Board of Directors are responsible for the other information. The other information comprises the information included in the Companys annual report but does not include the standalone financial statements and our auditors 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 for the Standalone Financial Statements

The Companys Management and Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 (“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 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 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 financial statements 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 is responsible for assessing the Companys 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.

Those Board of Directors are also responsible for overseeing the

Companys financial reporting process.

Auditors Responsibilities for the Audit of the Standalone

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 auditors 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.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism 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 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 control relevant to the audit in order to design audit procedures that are appropriate in the

circumstances. Under section 143(3)(I) of the Companies Act, 2013, 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 managements 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 Companys ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors 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 auditors report. However, future events or conditions may cause 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 financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit ndings, 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 standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors 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

1. As required by the Companies (Auditors Report) Order, 2020 (“the Order”), issued by the Central Government of India in terms of subsection (11) of section 143 of the Companies Act, 2013, we give in the “Annexure A” 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 Changes in Equity, the Statement of Pro t and Loss (including other comprehensive income), and the Cash Flow Statement 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 Indian Accounting Standards (Ind AS) specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e. On the basis of the written representations received from the directors as on 31st March 2023 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 2023 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 over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”.

g. With respect to the other matters to be included in the Auditors 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 41 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. (a) 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 person or entity, including foreign entities , 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 or provide any guarantee, security or the like on behalf of the Ultimate Bene ciaries.

(b) The management has represented, that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been received by the company from any person or entity , including foreign entities , 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 Bene ciaries”) or provide any guarantee, security or the like on behalf of the Ultimate Bene ciaries.

(c) Based on such audit procedures that the auditor has considered reasonable and appropriate in the circumstances, nothing has come to their notice that has caused them to believe that the representations under sub-clause (i) and (ii) contain any material misstatement.

v. (a) The dividend proposed in the previous year, declared, and paid by the company during the year is in accordance with section 123 of the Act.

(b) The Board of Directors have proposed dividend for the current year which is subject to the approval of the members at the Annual General Meeting.

3. With respect to the matter to be included in the Auditors Report

under section 197(16):

According to the information & explanations given to us and based on our examination of the records of the Company, the Company has paid / provided for managerial remuneration in accordance with the provisions of section 197 of the Act. for S S J N B & CO

Chartered Accountants

Firm registration number: 013976S

Dhanpal I Sakaria

Partner

Membership No: 213666

Place: Bengaluru Date : 29th May, 2023

UDIN: 23213666BGZBZC3277

Annexure A to the Independent Auditors Report of even date to the members of Bal Pharma Limited,

on the standalone financial statements for the year ended 31 March 2023

Based on the audit procedures performed for the purpose of reporting a true and fair view on the standalone financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, and to the best of our knowledge and belief, we report that,

I) a) (A) The Company has maintained proper records showing full, including quantitative details and situation of property, p lant, and equipment. (B) The Company has maintained proper records showing full particulars of intangible assets.

b) According to the information and explanations given to us, the Property, Plant and Equipment have not been physically veri ed by the

management during the year.

c) The title deeds of all the immovable properties (other than properties where the Company is the lessee and the lease agreements are duly

executed in favour of the lessee), as disclosed under Property, Plant and Equipment in the financial statements are held in the name of the Company.

d) The Company has not revalued its Property, Plant and Equipment or Intangible Assets during the year.

e) According to the information and explanations given by the management, no proceedings has been initiated or are pending against the Company

for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 and the rules made thereunder.

ii) a) As explained to us, inventory of the company has been physically veri ed during the year by the management at regular intervals. In our opinion, the frequency of such veri cation is reasonable. The discrepancies identified on veri cation were not more than 10% or more in aggregate for each class of inventory. Inventories lying with the third parties have been con rmed by them and no material discrepancies were noticed in respect of such confirmations.

b) According to the information and explanations given to us by the management and based on our examination of the books of accounts in the normal course of audit, the Company has been sanctioned working capital limits in excess of ve crores rupees in aggregate, from bank or financial institutions on the basis of security of current assets. In our opinion, the quarterly returns or statements led by the Company with such banks or financial institutions are in agreement with the books of account of the company.

iii) According to the information and explanation given to us and based on the audit procedures performed by us, during the year the Company has not

made any investments in, nor provided any loans or advances in nature of loans or stood guarantee or provided security to any entity. Thus,

paragraph 3(iii) of the Order is not applicable to the Company. a) (A) According to the information and explanations given to us and based on the audit procedures performed by us, during the year the Company

has not provided any loans or advances in nature of loans, or stood guarantee or provided security to its subsidiaries, joint ventures and associates

other than that disclosed below:

Particulars	Loans (in lakhs)	Advances in nature of Loan	Guarantee	Security
Aggregate amount during the year
- Subsidiaries (Golden Drugs Private Limited)	805.78	-	-	-
- Associate	-	-	-	-
- Joint Venture	-	-	-	-
Balance outstanding as at the year-end:
- Subsidiaries (Golden Drugs Private Limited)	2554.13	-	-	-
- Associate	-	-	-	-

(B) According to the information and explanations given to us and based on the audit procedures performed by us, during the year the Company has not provided any loans or advances in nature of loans or stood guarantee or provided security to any parties other than subsidiaries, Associate, and joint venture.

b) According to the information and explanations given to us and based on the audit procedures conducted by us, The investments made, guarantee

provided, and the terms and conditions of loans granted by the Company are as follows:

Particulars	Name of the subsidiaries	Aggregate amount given during the year (Amount in Lakhs)	Balance outstanding as on Balance sheet date.	Terms and Conditions
Investments made	1. Lifezen Health care Private Limited.	-	Rs 198.91	-
	2. Bal Research Foundation	-	Rs 8.00	-
	3. Balance Clinic LLP	-	Rs 8.00	-
	4. Golden Drugs Private Limited	-	Rs 741.69	-
Guarantee Provided	NA	NA	NA	NA
	Golden Drugs Private Limited	Rs 805.78	Rs 2,554.13	01.The said subsidiary has incurred losses and have negative net worth.
Loans granted				However, the management has led for merger of the entity. 02. The agreement for the same doesnt subsist and the same is repayable on demand.
				03.The interest is being charged at the rate of 11.06%.
Advances in nature of loan	NA	NA	NA	NA

c) According to the information and explanation provided to us and based on the audit procedures conducted by us, the Company has not granted any loan or advance in nature of loan to any parties. This, reporting under paragraph 3(iii) (c), 3(iii)(d), 3(iii)(e) and 3(iii)(f) is not applicable to the Company

d) In respect of loans and advances in the nature of loans, the loans are repayable as per the contractual terms as mutually agreed. As per the contractual terms, the loans have not fallen due for repayment. Accordingly, there has been no default on the part of the parties to whom the money has been lent.

e) In respect of loans and advances in the nature of loans, as no amount is overdue for more than ninety days and thus, paragraph 3(iii)(d) of the

Order is not applicable to the Company.

f) According to the information and explanation provided to us, in respect of loans and advances in the nature of loans, there has been no renewal or

extension of existing loans to settle the overdue of existing loans given to the same parties.

g) According to the information and explanation provided to us and based on the audit procedures conducted by us, the Company has granted loan

to its Subsidiary which are repayable on demand and for the same agreement does not subsist.

	All Parties	Promoters	Related Party
			(in lakhs)
Aggregate of loans as on Balance sheet date	-	-
- Repayable on Demand	-	-	2554.13
- Agreement does not specify any terms or period of repayment	-	-	-
Percentage of loans/advances in nature of loan to the total loans	-	-	100%

iv) In our opinion and according to the information and explanations given to us the Company has not advanced loans to directors/ to a Company in which the director is interested to which the provisions of Section 185 of the Companies Act, 2013 (Act) apply and hence not commented upon. However, in respect of loans given, investments made and guarantees given to subsidiary, associates, or joint ventures the Company is in compliance with provisions of Section 186 of the Act.

v) The Company has not accepted any deposits or has any amounts which are deemed to be deposits to which the provisions of Section 73 to 76 or any other relevant provisions of the Companies Act rules framed thereunder and the directions issued by the RBI are applicable. Hence paragraph 3 (v) of CARO is not applicable to the company.

vi) We have broadly reviewed the cost records maintained by the company pursuant to the Companies (Cost Accounting Records) Rules, as amended, specified by the Central Government under section 148(1) of the Companies Act and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

vii) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees State Insurance, Income-tax, Duty of Customs, Goods and Services tax, Cess and other material statutory dues have not been regularly deposited by the company with the appropriate authorities though the delays in deposit have not been serious.

(b) According to the information and explanations given to us and based on the audit procedures conducted by us, there are no dues of income tax,

Goods and Service Tax, custom duty, and cess which have not been deposited on account of any dispute other than that stated below:

Statement of Disputed Dues
Name of the statute	Nature of Dues	Amount (in lakhs)	Period to which the amount relates	Forum where the. dispute is pending	Remarks, if any
Chapter V of Finance Act, 1994	Service Tax and equivalent penalty	31.70 Lakhs	Nov 2007 to March 2012	Assistant Commissioner of Service Tax.
Chapter V of Finance Act, 1994	Service Tax and equivalent penalty	27.34 Lakhs	FY 2012-13 to FY 2016-17	Audit Commissioner of Central Excise
Chapter V of Finance Act, 1994	Service Tax and equivalent penalty	15.51 Lakhs	FY 2012-13 to FY 2015-16	Audit Commissioner of Central Excise
Income tax Act, 1961	Income tax	99.10 Lakhs	FY 2016-17 (AY 2017-18)	Commissioner of Income Tax (Appeals)
Income tax Act, 1961	Income tax	60.55 Lakhs	FY 2018-19 (AY 2019-20)	Commissioner of Income Tax (Appeals)
Income tax Act, 1961	Income tax	147.25 Lakhs	FY 2017-18 (AY 2018-19)	Commissioner of Income Tax (Appeals)
Goods & Service Tax	GST	1069.64 Lakhs	Oct-2018 to Dec-2019	Of ce of DGGI

The Company has received show cause notices under the Central Excise laws and Service Tax laws for the years 2007-08 onwards which in various stages of assessment as of 31 March 2023. The assessments are in progress and the Company has not received the assessment order in respect of the same. In certain cases, the Company has preferred an appeal which has been remanded back to the original authority for reassessment.

viii) Based on our audit procedure and on the information and explanation given to us by the management, no transaction has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.

ix) a) Based on our audit procedure and on the information and explanation given by the management, we are of the opinion that the company has not defaulted in repayment of loans or other borrowing to its lender other than that stated below:

Nature of Borrowing including debt	Name of lender	Amount not paid on due date (in lakhs)	Whether Principal or Interest	No of days of delay	Remarks, if any
securities
Vehicle Loan	HDFC bank	0.33	Both	34
Vehicle Loan	HDFC bank	0.33	Both	4
Vehicle Loan	HDFC bank	0.33	Both	9
Vehicle Loan	HDFC bank	0.33	Both	13
Vehicle Loan	HDFC bank	0.33	Both	1
Vehicle Loan	HDFC bank	0.33	Both	4
Vehicle Loan	HDFC bank	0.33	Both	2
Term Loan	HDFC bank	16.14	Both	2
Term Loan	HDFC bank	15.94	Both	6
Term Loan	HDFC bank	15.88	Both	8
Term Loan	Tata capital Financial Service Ltd	26.46	Both	3
Term Loan	Tata capital Financial Service Ltd	26.65	Both	1
Term Loan	Tata capital Financial Service Ltd	27.25	Both	1
Term Loan	Tata capital Financial Service Ltd	27.23	Both	2
Vehicle Loan	Mercedes- Benz
	Financial Services India Pvt Ltd,	1.37	Both	1

b) According to the information and explanation given to us by the management, the Company is not declared as willful defaulter by any bank or Financial Institution or other lenders. c) In our opinion and according to the information and explanations given to us, the Company has utilized the money obtained by way of term loans during the year for the purposes for which they were obtained. d) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long-term purposes by the company. e) According to the information and explanations given to us and on an overall examination of the balance sheet of the company/ examination of the cash flow statement of the Company, we report that the company has not taken any funds from any entity or person on account of or to meet the obligations of its subsidiaries, associates or joint ventures as defined under Companies Act, 2013. f) According to the information and explanations given to us and procedures performed by us, we report that the company has not raised loans during the year on the pledge of securities held in its subsidiaries, joint ventures, or associate companies.

x) a) According to the information and explanation given to us and based on audit procedure performed, no money was raised by the way of public

issue/follow-on-offer (including debt instruments).

xi) Based upon audit procedure performed and information and explanation given by the management, we report that no fraud by the company or any fraud on the company has been noticed or reported during the year. a) No report under sub-section (12) of section 143 of the Companies Act has been led by us or by other auditors of the Company. b) As represented to us by the management, there are no whistle blower complaints received by the company during the year. xii) The company is not a Nidhi Co. and therefore clause 3(ix) of the order is not applicable to the company. xiii) In our opinion, all transactions with the related parties entered into by the Company during the year are in compliance with section 188 of the Companies Act of 2013 and the details thereof have been disclosed in the Financial Statement as required by the Accounting Standards and Companies Act, 2013. Further, the company has complied with the provisions of Sec 177 subject to certain exceptions. xiv) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business. a)We have considered the Internal Audit reports of the Company issued till date, for the period under audit xv) Based on the information and explanations given to us, in our opinion during the year the company has not entered into any non-cash transactions with its directors or persons connected with its directors and hence provisions of section 192 of the Companies Act, 2013 are not applicable to the Company xvi) According to the information and explanation given to us and in our opinion, the Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. a) Based on the audit procedure performed, the Company has not conducted any Non-Banking Financial or Housing Finance activities as per the Reserve Bank of India Act, 1934. b) Based in audit procedure performed, the company is not a Core Investment Company (CIC) as defined in the regulations made by the Reserve Bank of India. c) Based in audit procedure performed, the Company or any of the companies in the group are Core Investment Company (CIC) as defined in the regulations made by the Reserve Bank of India. xvii) The Company has not incurred any cash losses in the financial year and in the preceding financial year. xviii) There has been no resignation of the statutory auditors during the year and accordingly clause is not applicable. xix) According to the information and explanations given to us and on the basis of the financial ratios, ageing and expected dates of realization of financial assets and payment of financial liabilities, other information accompanying the financial statements, our knowledge of the Board of Directors and management plans, we are of the opinion that no material uncertainty exists as on the date of the audit report that company is capable of meeting its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date xx) (a) There is no amount remaining unspent under sub-section (5) of section 135 of the Companies Act, pursuant to any ongoing project.

Accordingly, reporting under clause 3(xx)(b) of the Order is not applicable for the year.

for S S J N B & CO

Chartered Accountants

Firm registration number: 013976S

Dhanpal I Sakaria

Partner

Membership No: 213666

Place: Bengaluru Date : 29th May, 2023

UDIN: 23213666BGZBZC3277

Annexure B to the Independent Auditors Report

on the standalone financial statements of Bal Pharma Limited for the period ended 31 March 2023

Report on the Internal Financial Controls with reference to the aforesaid standalone financial statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (‘the Act)

(Referred to clause (f) of paragraph 2 under ‘Report on other Legal and Regulatory requirements Section of our report to the members of Bal Pharma Limited of even date)

Opinion

We have audited the internal financial controls with reference to financial statements of Bal Pharma Limited (“the Company”) as of 31 March 2023 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

In our opinion, the Company has, in all material respects, adequate internal financial controls with reference to financial statements and such internal financial controls were operating effectively as at 31 March 2023, based on the internal financial controls with reference to financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (the “Guidance Note”).

Managements Responsibility for Internal Financial Controls

The Companys management and the Board of Directors are responsible for establishing and maintaining internal financial controls based on the internal financial controls with reference to financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013 (hereinafter referred to as “the Act”).

Auditors Responsibility

Our responsibility is to express an opinion on the Companys internal financial controls with reference to financial statements based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls with reference to financial statements. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to financial statements were established and maintained and whether such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to financial statements and their operating effectiveness. Our audit of internal financial controls with reference to financial statements included obtaining an understanding of such internal financial controls, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companys internal financial controls with reference to financial statements.

Meaning of Internal Financial Controls Over Financial

Reporting

A companys internal financial controls with reference to financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial controls with reference to financial statements include those policies and

procedures that:

(1)pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company.

(2)provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and

(3)provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

for S S J N B & CO

Chartered Accountants

Firm registration number: 013976S

Dhanpal I Sakaria

Partner

Membership No: 213666

Place: Bengaluru Date : 29th May, 2023

UDIN: 23213666BGZBZC3277

ANNUAL ACCOUNTS 2022 - 2023