KBS India has disclosed the impact of audit qualifications for the quarter and year ended March 31, 2026, revealing outstanding receivables from a closed subsidiary and unprovided employee benefits. The company submitted these statements to BSE Limited following its earlier announcement of unaudited standalone financial results. The disclosures highlight potential overstatements in profit and accumulated reserves due to the lack of provisions for these items.

The audit report identifies a long-term loan of ₹16,65,40,533 and a current account outstanding balance of ₹8,02,444 due from KBS Capital Management Singapore Pte Ltd as of March 31, 2024. The subsidiary has since been closed down, and no provision has been made for these amounts in the financial statements for the year ended March 31, 2026. Auditors stated that this failure to provision has resulted in an overstatement of profit and accumulated reserves & surplus.

Additionally, the auditors qualified the financial statements regarding the gratuity liability of employees. The company has not provided for this liability as required by Ind AS 19 on "Employee Benefits". The impact of this liability remains unquantified due to the absence of an actuarial valuation or management estimate. The Board of Directors acknowledged the observation and stated they are in the process of resolving the issue.

Despite these qualifications, the standalone financial figures reported by the company remain unchanged. The table below details the audited figures before and after adjusting for the qualifications, showing no variance in the reported numbers.

The audit qualifications were issued by Bhuta Shah & Co. LLP, the statutory auditors. Both qualifications regarding the unpaid loans and gratuity liability were marked as repetitive. The management confirmed that the auditor's observations were discussed and noted that steps are being taken to address the gratuity liability issue.

KBS India Limited reported a net profit of ₹8.76 lakh for the financial year ended March 31, 2026, a decline from ₹17.66 lakh in the previous year. The company's board approved the audited financial results for the quarter and year ended March 31, 2026, during a meeting held on May 30, 2026. The statutory auditors, Bhuta Shah & Co LLP, issued an audit report highlighting significant emphasis of matter regarding unprovided employee benefits and unrecoverable loans from a former subsidiary.

The auditors reported that gratuity liability for employees has not been provided for as required by Ind AS 19, and the impact remains unquantified due to the absence of actuarial valuation. Additionally, a long-term loan of ₹16,65,40,533 and a current account outstanding balance of ₹8,02,444 due from KBS Capital Management Singapore Pte Ltd, an erstwhile subsidiary, remain outstanding. The subsidiary has been struck off, and no provision has been made as RBI permission for write-off is awaited, resulting in a misstatement of profit and accumulated reserves.

Revenue from operations for the year stood at ₹233.94 lakh, down from ₹236.74 lakh in FY25. Total income decreased to ₹341.71 lakh from ₹351.01 lakh in the previous year. Total expenses for the year increased to ₹329.48 lakh compared to ₹305.41 lakh in FY25. For the quarter ended March 31, 2026, the company reported a net loss of ₹10.04 lakh, contrasting with a net profit of ₹6.06 lakh in the same quarter of the previous year.

Financial Performance Summary

The company's equity share capital remained constant at ₹1082.12 lakh. The board meeting commenced at 02:00 P.M. and concluded at 05:00 P.M. The filing was submitted to BSE Limited on May 30, 2026, pursuant to Regulation 30 and 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.