I found an issue with the audio when fighting a battle in the Shin-Ra Mansion Basement, in Niblheim (when actually visiting there after Cosmo Canyon, not the flashback). Vincent's Theme ("The Nightmare's Beginning") is the background music in this area, then as soon as a battle starts the audio instruments are quite jumbled--make sure your volume is low, as this is not pleasant. The victory fanfare is normal, and then returning to Vincent's Theme is fine as well, but it keeps happening to me when I enter a battle from that background music in this area. This does not affect the gameplay at all.
I'm using Beacause + Chicago (08-06-2021), and this issue is present in both RetroArch's Beetle PSX HW and Beetle PSX emulators (using either the openal or wasapi audio drivers).
I checked Beacause + Chicago (01-01-2021) and FFVII unpatched with both these emulators and this issue is not present--the battle music is fine in this area there.