We have audited the accompanying Standalone Financial Statements
of J.G. CHEMICALS LIMITED ('the Company'), which comprise the
Standalone Balance Sheet as at 31st March 2025, the Standalone
Statement of Profit and Loss (including Other Comprehensive
Income), the Standalone Statement of Cash Flows and the Standalone
Statement of Changes in Equity for the year then ended and notes to
the standalone financial statements, and a summary of the material
accounting policies and other explanatory information (hereinafter
referred to as the "standalone financial statements").
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 Companies Act, 2013
('the Act') in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India
including Indian Accounting Standards ('Ind AS') prescribed under
section 133 of the Act read with the Companies (Indian Accounting
Standards) Rules, 2015, as amended, ("Ind AS"), of the state of affairs
of the Company as at 31st March 2025, its profit including other
comprehensive income, its cash flows and the changes in equity 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 Act. Our responsibilities
under those SAs are further described in the Auditor's 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 ('ICAI') together with the ethical requirements that are relevant to
our audit of the standalone financial statements under the provisions
of the Act 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 audit opinion
on the standalone 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 Standalone Financial
Statements for the financial year ended March 31, 2025. 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. We have
determined the matters described below to be the key audit matters
to be communicated in our report:
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Sl. No.
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Key Audit Matter
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How the matter was addressed in our audit
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1
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Revenue Recognition and Measurement
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Our audit procedures included:
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Refer Note 2(C)(b) to accounting policies and Note 25 to the
Standalone Financial Statements.
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• Assessing the Company's revenue recognition accounting
policies for compliance with Ind AS.
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Revenue is recognised when the Company satisfies the
performance obligation by transferring the promised goods
or service to a customer. The performance obligations are
fulfilled at the time of dispatch, delivery or upon formal
customer acceptance depending on terms of contract with
customers.
We consider there to be a risk of misstatement in the
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• Testing the controls around the timely and accurate recording
of sales transaction. We also tested the Company's lead
time assessment and quantification of any sales reversals
for undelivered goods. In addition, we tested the terms and
conditions set out in the sales contracts and management's
estimate of transit time required to deliver the goods.
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financial statements related to transactions occurring close
to the year end, as transactions could be recorded in the
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• Testing the design, implementation and operating effectiveness
of the Company's controls on recording revenue.
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incorrect financial period (cut-off risk).
Accordingly, revenue recognition is a key audit matter.
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• Performing testing on selected statistical samples of revenue
transactions recorded throughout the year and at the year end.
• Assessing and testing the adequacy and completeness of the
Company's disclosures in respect of revenue from operations.
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Sl. No.
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Key Audit Matter
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How the matter was addressed in our audit
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2
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Inventory Valuation
The Company is having inventory of B388.94 million as on
31st March, 2025. Inventories are to be valued as per Ind
AS 2. As described in the accounting policies in note 2(C)
(h) to the Standalone Financial Statements, finished goods
are valued at lower of the cost and net realisable value.
Materials and other supplies are not written down below
cost if the finished product in which it will be incorporated
are expected to be sold at or above cost. Cost of inventories
is ascertained on 'FIFO' basis.
Zinc metal and zinc based products form a significant part
of the Company's inventory for which the Company enters
into commodity contracts. The Company takes a structured
approach to the identification, quantification and hedging
of risk of fluctuations in prices of zinc metal by using
derivatives in commodities.
We focused on this area because of its size, the assumptions
used in the valuation and the complexity, which are relevant
when determining the amounts recorded.
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Our audit procedures included:
• Testing the design, implementation and operating effectiveness
of key internal financial controls, including controls over valuation
of inventory, and accounting of derivative transactions.
• On a sample basis, testing the accuracy of cost for inventory
by verifying the actual purchase cost. Testing the net realisable
value by comparing actual cost with most recent sale price.
• Reviewing the documents and other records related to physical
verification of inventories done by the management during the
year.
• Verifying that inventories are valued in accordance with Ind AS 2.
• Assessing and testing adequacy and completeness of the
Company's disclosures in the Standalone Financial Statements.
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Information other than the Standalone Financial Statements
and Auditor's Report thereon
The Company's Management and the Board of Directors are
responsible for the other information. The other information
comprises the information included in the Company's annual report
but does not include the Standalone Financial Statements and our
auditor's report thereon. The Company's annual report is expected to
be made available to us after the date of this auditor's report.
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 identified above
when it becomes available 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 and Those Charged with Gov¬
ernance for the Standalone Financial Statements
The accompanying Standalone Financial Statements have been
approved by the Company's Board of Directors. The Company's Board
of Directors is responsible for the matters stated in section 134(5) of
the Act with respect to the preparation of these Standalone Financial
Statements that give a true and fair view of the State of affairs, Profit
including Other Comprehensive Income, Changes in Equity and Cash
Flows of the Company in accordance with the accounting principles
generally accepted in India, including the Indian Accounting
Standards (Ind AS) specified under section 133 of the Act read
with the Companies (Indian Accounting Standards) Rules, 2015, as
amended. 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 Standalone 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, management
is responsible for assessing the Company's ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless
Board of Directors either intends to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.
The Board of Directors is also responsible for overseeing the
Company's financial reporting process.
Auditor's Responsibilities for the Audit of the Standalone Finan¬
cial Statements
Our objectives are to obtain reasonable assurance about whether
the Standalone Financial Statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue
an auditor's report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with Standards on Auditing 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 Standalone
Financial Statements.
As part of an audit in accordance with Standards on Auditing, we
exercise professional judgment and maintain professional scepticism
throughout the audit. We also:
• Identify and assess the risks of material misstatement of the
Standalone 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 financial controls relevant
to the audit in order to design audit procedures that are
appropriate in the circumstances. Under section 143(3)(i) of
the Act, we are also responsible for expressing our opinion on
whether the Company has adequate internal financial controls
with reference to Standalone 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 management's use of the
going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt
on the Company's ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to
draw attention in our auditor's report to the related disclosures
in the Standalone Financial Statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based
on the audit evidence obtained up to the date of our auditor's
report. However, future events or conditions may cause the
Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the
Standalone Financial Statements, including the disclosures, and
whether the Standalone Financial Statements represent the
underlying transactions and events in a manner that achieves
fair presentation.
Materiality is the magnitude of misstatements in the Standalone
Financial Statements that, individually or in aggregate, makes it
probable that the economic decisions of a reasonably knowledgeable
user of the Standalone Financial Statements may be influenced. We
consider quantitative materiality and qualitative factors in (i) planning
the scope of our audit work and in evaluating the results of our work;
and (ii) to evaluate the effect of any identified misstatements in the
Standalone Financial Statements.
We communicate with those charged with governance regarding,
among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement
that we have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships
and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance,
we determine those matters that were of most significance in the
audit of the Standalone Financial Statements of the current period
and are therefore the key audit matters. We describe these matters
in our auditor's report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances,
we determine that
a matter should not be communicated in our report because the
adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
As required by the Companies (Auditor's Report) Order, 2020 ('the
Order') issued by the Central Government of India in terms of
section 143(11) of the Act, we give in the Annexure A, a statement
on the matters specified in paragraphs 3 and 4 of the Order, to the
extent applicable.
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 of the accompanying
Standalone Financial Statements;
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 Standalone Balance Sheet, the Standalone Statement of
Profit and Loss including Other Comprehensive Income, the
Standalone Statement of Cash Flows and Standalone Statement
of Changes in Equity dealt with by this Report are in agreement
with the books of accounts;
d. in our opinion, the aforesaid Standalone Financial Statements
comply with the Indian Accounting Standards specified under
Section 133 of the Act, read with Companies (Indian Accounting
Standards) Rules, 2015, as amended from time to time;
e. on the basis of the written representations received from the
directors as on 31st March, 2025 and taken on record by the
Board of Directors, none of the directors are disqualified as on
31st March, 2025 from being appointed as a director in terms of
Section 164(2) of the Act;
f. with respect to the adequacy of the internal financial controls
with reference to Standalone Financial Statements of the
Company and the operating effectiveness of such controls refer
to our separate Report in Annexure 'B'.
g. With respect to the other matters to be included in the Auditor's
Report in accordance with the requirements of section 197(16)
of the Act, as amended.
In our opinion and to the best of our information and according
to the explanations given to us, the remuneration paid by the
Company to its directors during the year is in accordance with
the provisions of 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.
h. With respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 of the Companies (Audit
and Auditors) Rules, 2014 (as amended), 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,
other than those disclosed in the Standalone Financial
Statements, which would materially impact its
financial position. Refer note no. 35 to the standalone
financial statement.
ii. the Company has made provision, as required under the
applicable laws or accounting standards, for material
foreseeable losses, if any, on long-term contracts including
derivative contracts.
iii. there is no amount, 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 (which are
material either individually or in the aggregate) have
been advanced or loaned or invested (either from
borrowed funds or securities premium or any other
sources or kind of funds) by the Company to or in
any person(s) or entity(ies), including foreign entities
('the 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 ('the Ultimate Beneficiaries') or provide
any guarantee, security or the like on behalf of the
Ultimate Beneficiaries;
(b) The management has represented that, to the best
of its knowledge and belief, no funds (which are
material either individually or in the aggregate) have
been received by the Company from any person(s)
or entity(ies), including foreign entities ('the 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; and
(c) Based on such audit procedures performed as
considered reasonable and appropriate in the
circumstances, nothing has come to our attention
that causes us to believe that the management
representations under sub-clause (i) and (ii) of Rule
11(e), as provided under (a) and (b) above, contain
any material misstatement.
v. The Company has not declared or paid any dividend
during the year ended 31st March, 2025.
vi. In our opinion and according to the information and
explanations given to us and based on our examination of
the records of the Company, the Company has maintained
proper books of account including the relevant audit trail
(edit log) for the financial year ended March 31, 2025, as
required under Rule 3(1) of the Companies (Accounts)
Rules, 2014 (as amended), and the same has been
operated throughout the year for all relevant transactions
recorded in the software. Further, the audit trail feature has
not been tampered with and has been preserved by the
Company as per the statutory requirements.
For S. Jaykishan
Chartered Accountants
Firm's Registration No. 309005E
CA Ritesh Agarwal
Partner
Place: Kolkata Membership No.: 062410
Dated: The 17th day of May, 2025 UDIN: 25062410BMIPQD6227
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