We have audited the accompanying financial statements of M/S. SIMPLEX CASTINGS LIMITED
(CIN:L27320MH1980PLC067459) (“the Company”) which comprises the Balance Sheet as at March 31, 2025, the
Statement of Profit and Loss (including Other Comprehensive Income), Statement of Changes in Equity & 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 (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 ('Act') in the manner so required and give a true
and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the
Companies (Indian Accounting Standards) Rules, 2015, as amended, (“Ind AS”) and other accounting principles generally
accepted in India, of the state of affairs of the Company as at March 31, 2025, and the Profit and total 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 Auditor's Responsibilities
for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with
the Code of Ethics issued by the Institute of Chartered Accountants of India 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 there under,
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
i. As stated in Note 20 to the financial statements, the Company has recognized a Total provision of '195.65 Lakhs upto
31st March, 2025 for interest on delayed payments to Micro and Small Enterprises (MSMEs) as required under the
Micro, Small and Medium Enterprises Development (MSMED) Act, 2006. However, no actual payment of such interest
has been made by the Company till the reporting date.
ii. As stated in Note 24 to the financial statements, the Company has netted off Liquidated damage charges of '152.84
Lakhs from Purchases. Such charges are levied on a vendor due to the supply of goods not conforming to the agreed
specifications or quality requirements. The recognition of such charges is based on management's assessment and
interpretation of contractual terms and the same is also confirmed by the concerned vendor.
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. These matters were addressed in the context of our audit of the financial statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
We have determined the matters described below to be the key audit matters to be communicated in our report.
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Sr. No.
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Key Audit Matters
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How our audit addressed the Key Audit Matter
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1
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VALUATION OF INVENTORIES:
The net carrying value of inventory as on 31st March
2025 is Rs.5,791.78 Lakhs which constitutes 31.90% of
total assets of the company.
Inventories are material to the Company's Balance
Sheet and represent a significant portion of its total
assets. The valuation of inventories involves significant
management judgement, particularly with respect to
estimation of net realizable value, obsolescence, and
allocation of overheads in the case of manufactured
inventories. Given the quantitative significance and
the involvement of estimates and assumptions, we
considered the valuation of inventories to be a key audit
matter.
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To address the risk of material error on inventories, our
audit procedures included amongst other:
• Obtaining an understanding of and evaluating
the design and implementation of key internal
controls relating to inventory valuation and physical
verification.
• Attended physical inventory counts on a sample
basis and performed test counts to evaluate the
existence and condition of inventories.
• Assessed the appropriateness of the Company's
accounting policies relating to inventory valuation
and compliance with applicable financial reporting
framework.
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Sr. No.
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Key Audit Matters
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How our audit addressed the Key Audit Matter
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RELATED DISCLOSURES:
Please refer to Note-2.2 (j) for details of the accounting
policies of inventories and Note- 11 of notes to financial
statements for relevant disclosures of inventories.
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• Evaluated the basis of inventory valuation
including the methods used for cost allocation and
the determination of net realizable value.
• Assessing the effectiveness of key controls at the
inventory storage location.
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2
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REVENUE RECOGNITION:
Revenue from operations is a significant item in the
financial statements and a key performance indicator for
the Company. For the year ended March 31, 2025, the
Company has recognized revenue from operations of
Rs. 17,188.36 Lakhs. As per Ind AS 115 Revenue from
Contracts with Customers, revenue is to be recognized
upon the transfer of control of goods or services to the
customer. During the year, the Company derecognized
revenue of Rs.1097.19 Lakhs as the criteria for transfer
of control — including transfer of significant risks and
rewards — were not met as at the year-end.
The determination of the timing of revenue recognition
involves significant management judgement, especially
in assessing the transfer of control in complex or
borderline cases. Due to the materiality of revenue to
the financial statements and the judgment involved
in assessing whether the revenue recognition criteria
have been met, particularly at year-end, this area was
considered a key audit matter.
RELATED DISCLOSURES:
Please refer to Note-2.2 (h) for details of the accounting
policies of revenue recognition Note-21 and Note-22 of
notes to financial statements for relevant disclosures of
Revenue from Operations.
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Our Audit Procedure:
• Obtained an understanding of the Company';
revenue recognition policies and evaluated thei
compliance with Ind AS 115.
• Evaluated the design and implementation of ke
internal controls over revenue recognition and
tested their operating effectiveness.
• Performed detailed substantive testing on a sample
basis of revenue transactions near the year-end to
assess whether revenue was recognized in the
appropriate period.
• Examined underlying sales contracts, dispatch
documentation, goods receipt notes, and othe
supporting evidence to assess whether the control
including risk and rewards of ownership, had
transferred to customers as per the terms of the
contract.
• Reviewed credit notes, returns, and subsequen
events after the balance sheet date to identify an
revenue reversals or conditions indicating tha
control had not transferred at the year-end.
• Assessed management's judgement in
derecognizing revenue and evaluated whethe
such derecognition was in line with the principle
of Ind AS 115.
• Assessed the disclosures made by the Company.
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3
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TRADE RECEIVABLES:
The Net Carrying Value of Trade Receivables as at 31st
March 2025, amounted to '5,113.61 lakhs (Net of ECL),
representing 28.16% of its total assets. Management
has recognized a provision of '261.04 lakhs towards
expected credit losses (ECL) in accordance with
the with Ind AS 109 - Financial Instruments. The
assessment of recoverability of trade receivables and
the estimation of ECL involves significant management
judgment, including evaluation of credit risk, customer
payment behavior, ageing of receivables, and forward¬
looking information such as macroeconomic factors.
Trade Receivables were considered as a Key Audit
Matter due to materiality of the trade receivables
balance to the financial statements and the degree of
estimation and judgment involved in determining the
ECL.
RELATED DISCLOSURES:
Please refer to Note-2.2 (r)(D) & 3(b) for details of the
accounting policies of revenue recognition and Note-12
of notes to financial statements for relevant disclosures
of Trade Receivables.
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Our Audit Procedure:
• Obtained an understanding of the Company';
credit control policies and evaluated the design
and implementation of key controls over monitoring
and collection of trade receivables.
• Reviewed ageing analysis of trade receivables and
identified significant overdue balances for furthe
scrutiny.
• Reviewed subsequent receipts from customer;
after year-end.
• Evaluated the reasonableness of management';
assumptions and estimates used in the
computation of ECL, including historical collection
trends, customer credit profiles, and forward
looking information.
• Assessed the adequacy and appropriateness o
disclosures related to trade receivables and credi
risk in the financial statements.
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Information other than the Financial Statements and Auditor's Report thereon
The Company's Board of Directors is responsible for the other information. The other information comprises the information
included in the Annual Report but does not include the financial statements and our auditor's report thereon. The Annual
Report is expected to be made available to us after the date of this auditor's report.
Our opinion on the financial statements does not cover the other information and we will 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.
When we read the Annual Report, if we conclude that there is a material misstatement therein, we are required to
communicate the matter to those charged with governance.
Management's Responsibilities for the Financial Statements
The Company's Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the
preparation of these financial statements that give a true and fair view of the financial position, financial performance,
including other comprehensive income, changes in equity and cash flows of the Company in accordance with the Ind AS
and other accounting principles generally accepted in India. 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 statement that give a true and fair view and are free
from material misstatement, whether due to fraud or error.
In preparing the 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
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 Company's financial reporting process.
Auditor's Responsibility for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable
assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with 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 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:
1. 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.
2. Obtain an understanding of internal controls relevant to the audit in order to design audit procedures that are appropriate
in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether
the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosures made by management.
4. Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the
audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant
doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we
are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained 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.
5. 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.
Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate, makes it probable
that the economic decisions of a reasonably knowledgeable user of the 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 financial statements.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought
to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most
significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe
these matters in our auditor's report unless law or regulation precludes public 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 (Auditor's Report) Order, 2020 (“the Order”), issued by the Central Government of India
in terms of sub-section (11) of section 143 of the Companies Act, 2013 are given in the Annexure A on the matters
Specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. A. 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 Profit and Loss, Statement of Changes in equity 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 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, 2025 taken on record
by the Board of Directors, none of the directors is 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 over financial reporting of the Company and the
operating effectiveness of such controls, refer to our separate Report in 'Annexure B'; and
B. With respect to the other matters to be included in the Auditor's Report in accordance with Section 197 (16) of the
Act, as amended:
a. 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 with 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; and
b. With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the
Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according
to the explanations given to us:
i. the Company has disclosed the impact of pending litigations on its financial position in its financial
statements - Refer Note 31 & 32 to the financial statements;
ii. the Company did not have any long-term contracts including derivative contracts for which there were any
material foreseeable losses; and
iii. there has been no delay in transferring amounts, required to be transferred, to the Investor Education and
Protection Fund by the Company
c. i. 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 persons or entities, including foreign entities
(“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary
shall:
- directly or indirectly lend or invest in other persons or entities identified in any manner 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.
ii. The management has represented, that, to the best of its knowledge and belief, no funds have been
received by the Company from any persons or entities, including foreign entities (“Funding Parties”), with
the understanding, whether recorded in writing or otherwise, that the Company shall:
- directly or indirectly, lend or invest in other persons or entities identified in any manner 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 Ultimate Beneficiaries.
iii. Based on such audit procedures as 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 (c) (i) and
(c) (ii) contain any material misstatement.
d. Company has not declared or paid any dividend during the year.
e. As Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using
accounting software which has a feature of recording audit trail (edit log) facility and preservation of audit trail
as per statutory requirements for record retention is applicable to the Company with effect from April 1, 2023,
and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is applicable for
the year ended on March 31st 2025
Based on our examination which included test checks performed by us, the company has used an accounting
software for maintaining its books of accounts for the financial year ended on 31st March 2025 which has
a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all the
relevant transactions recorded in the software. Further, during the course of audit, we have not come across
any instance of the audit trail feature being tampered with and the company has preserved the audit trail,
including the edit log, as per the statutory requirements for the purpose of record retention.
For, Harsh Jain & Associates
Chartered Accountants
(FRN- 007639C)
HARSH JAIN
Partner
Place: Durg (M. No. 076736)
Date : 30th May 2025 UDIN - 25076736BMGWQH2891
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