To the Members of
Dipna Pharmachem Limited
Ahmedabad
Report on the Audit of Financial Statements Opinion
We have audited the accompanying financial statements of Dipna Pharmachem Limited
("the Company"), which comprises the Balance Sheet as at March 31, 2023,
Statement of Profit and Loss (including Other Comprehensive Income), the Statement of
Changes in Equity and the Statement of Cash Flow for the year then ended, and notes to the
financial statements, including a summary of significant accounting policies and other
explanatory information (hereinafter referred to as "the financial statements").
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, of the
state of affairs of the Company as at 31st March, 2023, and its profit, total
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 (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 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 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 ICAIS 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
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. We have
determined that there are no key audit matters to communicate in our report.
Information Other than on Financial Statements and Auditors Report Thereon
The Board of Directors is responsible for the other information. The other information
comprises the information included in the Companys 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.
Responsibility of Management for Financial Statements and Those Charged with Governance
for the Financial Statements.
The Companys 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
and presentation of these financial statements that give a true and fair view of the
financial position and financial performance, and cash flows of the Company in accordance
with the accounting principles generally accepted in India, including the Accounting
Standards specified under Section 133 of the Act. This responsibility also includes
maintenance of adequate accounting records in accordance with the provisions of 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
judgements and estimates that are responsible 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 statements, Board of Director 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 Board of
Director either intends to liquidate the Company or to cease operations, or has no
realistic alternative but to do so.
Boards of Directors are also responsible for overseeing the companys financial
reporting process. Auditors Responsibilities for the Audit of the Financial Statement
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 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 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 Act, we are also responsible for expressing our opinion on whether the company has
adequate internal financial controls with reference 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 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 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
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 Section 143(11) of the Act, the matter specified in the
paragraph
3 and 4 of the Order is applicable to the company for the year under consideration and
attached
herewith.
2. As required by section 143(3) of the Act, based on our audit 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 purpose of our audit.
b) In our opinion proper books of account as required by law have been kept by the
Company so far as appears from our examination of those books;
c) The Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement
dealt with by this Report are in agreement with the books of account;
d) In our opinion, the aforesaid financial statements comply with the Accounting
Standards specified under Section 133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules 2014.
e) On the basis of written representations received from the directors as on March 31,
2023 taken on record by the Board of Directors, none of the directors is disqualified as
on March 31, 2023 from being appointed as a director in terms of Section 164 (2) of the
Act; and
f) In pursuance to notification dated 13th June 2017 amending the
notification of the Government of India in the Ministry of Corporate Affairs vide no G.S.R
464(E) dated 5th June 2015 reporting on adequacy of Internal Financial Controls
over the Financial Reporting of the company is attached herewith 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 does not have any pending litigations for which provision have not been
made which would impact its financial position.
ii) There are no long-term contracts including derivative contracts and accordingly no
provision is required to be made for any loss from the same;
iii) The Provisions of transfer of funds to Investor Education and Protection Fund not
applicable to the Company.
iv) (i) The Management has represented that, to the best of its knowledge and belief,
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;
(ii) The Management has represented, that, to the best of its knowledge and belief, 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;
(iii) 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.
h) No dividend is declared or paid during the year by the Company.
3. With respect to the matter to be included in the Auditors Report under Section
197(16) of the Act:
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. The remuneration paid to any director is
not in excess of the limit laid down under Section 197 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.
Annexure "A " to the Independent Auditors Report
(Referred to in Paragraph 1 under ‘Report on other legal and other regulatory
requirements in the
Independent Auditors Report of even date to the members of Dipna Pharmachem Limited
("the
Company") on the Financial Statements for the year ended 31st March 2023). We
report that:
(i) In respect to its fixed assets;
a. (A) The company has prepared Property, Plant and Equipment records showing
particulars including quantitative details and situation of Property, Plant and Equipment.
(B) The company do not have any Intangible Assets.
b. As informed to us, a substantial portion of the Property, Plant and Equipment have
been physically verified by the management during the year, which in our opinion is
reasonable having regard to the size of the Company and the nature of its assets. As
informed to us, no material discrepancies were noticed on such physical verification.
c. According to the information and explanation given to us and on the basis of our
examination of the records of the Company, the title deeds of immovable properties (other
than properties where the company is the lessee and the lease agreements are duly executed
in favor of the lessee) are held in the name of the Company.
d. The Company has not revalued any of its Property, Plant and Equipment (including
right-of- use assets) and intangible assets during the year.
e. No proceedings have been initiated during the year or are pending against the
Company as at March 31, 2023 for holding any Benami property under the Benami Transactions
(Prohibition) Act, 1988 (as amended in 2016) and rules made thereunder.
(ii) a. As explained to us, inventories have been physically verified during the year
by the management at reasonable intervals, except for goods-in-transit. As informed to us
there were no material discrepancies noticed on verification between the physical stocks
and the book records and any discrepancies found has been properly dealt within the books
of accounts.
b. The Company has been sanctioned working capital limits in excess of Rs.5 crore, in
aggregate, at any point of time during the year, from banks or financial institutions on
the basis of security of current assets. In our opinion and according to the information
and explanations given to us, the quarterly returns and statements comprising stock
statements, book debt statements, statements on ageing analysis of the debtors and other
stipulated financial information filed by the Company with such banks are in agreement
with the unaudited books of account of the Company, of the respective quarters.
(iii) During the year the company has made investments in, provided any guarantee or
security or granted any loans or advances in the nature of loans, secured or unsecured, to
companies, firms, Limited Liability Partnerships or any other parties amounting to
Rs.12,95,31,722/-.
(iv) In our opinion and according to the information and explanations given to us, the
Company has complied with the provisions of section 185 and 186 of the Act, with respect
of grant of loans, making investments and providing guarantees and securities, as
applicable. However, the Company has not charged the interest on abovesaid loans as
mentioned in above clause (iii).
(v) In our opinion, and according to the information and explanations given to us,
during the year under consideration, the Company has not accepted any deposits within the
meaning of sections 73 to 76 of the Act and Companies (Acceptance of Deposits) Rules, 2014
(as amended). Hence, reporting under Clause 3(v) of the aforesaid order are not
applicable.
(vi) According to the information and explanation given to us, the company is not
required to maintain the Cost Records under section 148 (I) of the Companies Act, 2013.
(vii) According to the information and explanations given to us and the records of the
Company examined by us:
(a) In our opinion, the Company is generally regular in depositing undisputed statutory
dues including Provident Fund, Employees State Insurance, Income Tax, Goods and Service
Tax, Sales Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and
other material statutory dues, as applicable, with the appropriate authorities except
Income Tax for the financial year 2021-22 amounting to Rs.40,25,000/-.
(b) There are no outstanding dues in respect of Income Tax, Goods and Service Tax,
Sales Tax, service tax, duty of customs, duty of excise, value added tax or cess etc which
have not been deposited/adjusted/reversed on account of any dispute.
(viii) There were no transactions relating to previously unrecorded income that have
been surrendered or disclosed as income during the year in the tax assessments under the
Income Tax Act, 1961 (43 of 1961).
(ix) a) According to information & explanations given to us, the company has not
defaulted in
repayment of loans or other borrowing or in the payment of interest thereon to any
lender.
b) The company has not been declared willful defaulter by any bank or financial
institution or other lender.
c) The Company has taken term loan during the year and is applied for the purpose for
which the loans were obtained.
d) On an overall examination of the financial statements of the Company funds raised on
short terms basis have, prima facie, not been used during the year for long term purposes
by Company.
e) On an overall examination of the financial statements of the Company, 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.
f) The company has not raised any loans during the year on the pledge of securities
held in its subsidiaries, joint ventures or associate companies. Hence reporting under
Clause 3(ix) (f) of the of the aforesaid order are not applicable.
x) (a) The Company has raised 40,02,000 Equity Shares of Rs. 10/- each amounting to Rs.
4,00,20,000 by way of initial public offer during the year. The fund raised through
Initial Public Offer has been utilized for the purpose for which it has been raised.
(b) During the year, the Company has made Right issue of 1625000 Equity shares of Rs.
10/- each amounting to Rs. 1,62,50,000/- and Bonus Shares of 6308000 Equity Shares of Rs.
10/- each amounting to Rs. 6,30,80,000/-. The fund raised through Right Issue has been
utilized for the purpose for which it has been raised. The company has complied with the
requirements of section 42 and section 62 of the Companies Act, 2013.
(xi) (a) According to information & explanations given to us, no material fraud by
the company or on the Company has been noticed or reported during the year.
(b) No report under sub section (12) of Section 143 of the Companies Act has been filed
in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014
with the Central Government during the year and upto the date of this report.
(c) The Company has not received any whistle blower complaints during the year.
(xii) In our opinion and according to the information and explanation given to us, the
Company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the Order is not
applicable to the Company.
(xiii) According to the information and explanations given to us and based on our
examination of the records of the Company, transactions with the related parties are in
compliance with sections 177 and 188 of the Act where applicable and details of such
transactions have been disclosed in the financial statements as required by the applicable
accounting standards.
(xiv) a) In our opinion the Company has an adequate internal audit system commensurate
with the size and nature of its business.
b) We have considered the internal audit reports of the company issued till date, for
the period under audit.
(xv) According to the information and explanation given to us, the Company has not
entered into any non-cash transactions with its directors or persons connected with him.
Accordingly, paragraph 3(xv) of the Order is not applicable to the Company.
(xvi) a) According to the information and explanations provided to us, the Company is
not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.
Accordingly, the paragraph 3(xvi) of the Order is not applicable to the Company.
b) The company has not conducted any Non-Banking Financial or Housing Finance
activities without a valid Certificate of Registration (CoR) from the Reserve Bank of
India as per the Reserve Bank of India Act 1934.
c) The company is not a Core Investment Company (CIC) as defined in the regulations
made by the Reserve Bank of India. Hence reporting under Clause 3(xvi(c) of the of the
aforesaid order are not applicable.
d) The Group does not have any CIC as part of the Group. Hence reporting under Clause
3(xvi)(d) of the of the aforesaid order are not applicable.
(xvii) The Company has not incurred cash losses during the financial year covered by
our audit and the immediately preceding financial year.
(xviii) The statutory auditors of the Company for the financial year 2021-22 have
resigned during the year and we have been appointed as statutory auditors of the Company.
(xix) 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 and our knowledge of the Board of Directors and management plans, and
based on our examination of the evidence supporting the assumptions, nothing has come to
our attention which causes us to believe that any material uncertainty exists as on the
date of the audit report indicating that company is not 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. We, however, state that this is not an assurance as to
the future viability of the company. We further state that our reporting is based on the
facts up to the date of the audit report and we neither give any guarantee nor any
assurance that all liabilities falling due within a period of one year from the balance
sheet date, will get discharged by the company as and when they fall due.
(xx) The provisions of Section 135 of Company Act are presently not applicable to the
Company. Hence reporting under Clause 3(xx) of the aforesaid order are not applicable.
(xxi) This report pertains to standalone financial statements. Hence reporting under
Clause 3(xxi) of the aforesaid order are not applicable.
Annexure "B" to the Auditors Report
Report on the Internal Financial Controls under Clause (i) of sub-section 3 of Section
143 of the Companies Act, 2013 (‘the Act)
We have audited the internal financial controls over financial reporting of Dipna
Pharmachem Limited ("the Company"), as of 31 March, 2023, in conjunction with
our audit of the financial statements of the Company for the year ended that date.
Managements Responsibility for Internal Financial Controls
The Companys management is responsible for establishing and maintaining internal
financial controls based on the internal controls over financial reporting 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 (‘ICAI). These
responsibility 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 the 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.
Auditors Responsibility
Our responsibility is to express an opinion on the Companys internal financial
controls over financial reporting based on our audit. We conducted our audit in accordance
with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting
(the ‘Guidance Note) and the Standards of Accounting, issued by ICAI and deemed to
be prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable
to an audit of internal financial controls, both applicable to an audit of Internal
Financial Controls, both issued by the Institute of Chartered Accountants of India. 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 over financial reporting was established and maintained and if 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 system over financial reporting and their operating
effectiveness. Our audit of internal financial controls over financial reporting included
obtaining an understanding or internal financial controls over financial reporting,
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 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 system
over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A companys internal financial control over financial reporting 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 control over financial
reporting includes 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 the Management and directors of the Company; and
(3) provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use, or disposition of the Companys assets that could have a
material effect on the financial statements.
Inherent 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.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal
financial controls system over financial reporting and such internal financial controls
over financial reporting were operating effectively as at 31 March 2023, based on the
internal control over financial reporting 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.
|
For, Devadiya & Associates |
|
Firm Reg. No. 123045W |
|
Chartered Accountants |
| Date: 10/07/2023 |
(CA. Sanjay Devadiya) |
| Place: Ahmedabad |
Partner |
|
Membership No. 112495 |
|
UDIN:23112495BGYWCW7444 |
+91-9892691696
