SecUR Credentials Limited has submitted a revised limited review report for its unaudited standalone financial results for the quarter ended December 31, 2024 (Q3FY25), correcting an inadvertent error in the previously filed document. While the underlying financial figures remain unchanged, the revised disclosure from statutory auditors JPMD & Associates reveals significant governance and compliance deficiencies, including unverified inventory balances, outstanding statutory dues, and a prohibited loan extended to a company director.

The company reported a net loss of ₹215.97 Lakhs for Q3FY25, widening from a net profit of ₹41.44 Lakhs in the same quarter last year. Revenue from operations turned negative at ₹(87.49) Lakhs, compared to ₹704.26 Lakhs in Q3FY24. For the nine months ended December 31, 2024, the company posted a cumulative net loss of ₹731.57 Lakhs against a net profit of ₹467.27 Lakhs in the corresponding period of FY24. The Board of Directors approved these results on May 04, 2026.

Key Financial Metrics

Critical Compliance Gaps

JPMD & Associates, the statutory auditors, raised multiple emphasis-of-matter points indicating severe internal control weaknesses. The auditors noted that inventory disclosed in the financial statements was not found during physical verification, suggesting a possible overstatement of prior period assets. Furthermore, GST returns, reconciliation statements, and supporting records were not made available, preventing verification of GST-related balances and statutory compliance.

Significant regulatory violations were also identified. The company granted a loan of ₹127.34 Lakhs to a director, which contravenes Section 185 of the Companies Act, 2013. Additionally, statutory dues outstanding as per opening balances remained unpaid as of December 31, 2024. The auditors also highlighted that Provident Fund (PF) and Employees' State Insurance (ESIC) challans and returns were not produced for verification, leaving the accuracy of related statutory dues unconfirmed.

Accounting Non-Compliances

The review report detailed several departures from Indian Accounting Standards (Ind AS). The company failed to recognize gratuity provisions or obtain actuarial valuations as required under Ind AS 19 – Employee Benefits. Expected Credit Loss (ECL) provisions mandated by Ind AS 109 were also not made. Moreover, current maturities of long-term borrowings were not disclosed due to the non-availability of repayment schedules. Deferred Tax Assets were not recognized due to uncertainty regarding future taxable profits, in line with Ind AS 12. Trade receivables and payables were accepted based on management certification without independent balance confirmations.

What the Numbers Show

The divergence between the negative revenue from operations and the substantial expense base highlights operational distress. With revenue collapsing to negative territory while employee benefits and finance costs remained elevated at ₹32.24 Lakhs and ₹52.19 Lakhs respectively in Q3FY25, the company’s core business model appears unsustainable without immediate intervention. The inability of auditors to verify basic statutory dues and inventory existence raises serious questions about the reliability of the reported asset base and liquidity position.

SecUR Credentials Limited reported a standalone net loss of ₹132.99 lakh for the quarter ended September 30, 2024 (Q2FY25), as revenue plummeted 88.7% year-on-year to ₹79.07 lakh. The filing, submitted on August 4, 2026, includes revised cash flow statements that were inadvertently omitted in the initial disclosure. More critically, the results are accompanied by a limited review report from statutory auditors JPMD & Associates containing multiple emphasis of matter notes regarding material compliance gaps and potential overstatements.

The company’s total income fell to ₹97.66 lakh from ₹741.37 lakh in the same period last year. Total expenses stood at ₹230.65 lakh, with employee benefits at ₹37.58 lakh and finance costs at ₹38.81 lakh. For the half-year ended September 30, 2024, the net loss widened to ₹515.60 lakh compared to a profit of ₹425.84 lakh in H1FY24. Cash and cash equivalents dropped to ₹200.57 lakh from ₹257.42 lakh in the previous half-year period.

Key Financial Metrics

Audit Qualifications and Compliance Gaps

The limited review report by JPMD & Associates highlights several critical issues that undermine the reliability of the financial statements. The auditors noted that Goods and Services Tax (GST) returns and reconciliation statements were not made available, preventing verification of GST-related balances. Furthermore, inventory disclosed in the books was not found during physical verification, indicating a possible overstatement of inventory in prior periods.

Other significant findings include:

• Statutory Non-Compliance: The company granted a loan of ₹152.12 lakh to a director, contravening Section 185 of the Companies Act, 2013.
• Missing Provisions: No provision for gratuity has been recognized, violating Ind AS 19 – Employee Benefits, and no actuarial valuation was obtained.
• Unverified Balances: Trade receivables and payables were considered certified by management without independent balance confirmations. Expected Credit Loss (ECL) provisions required under Ind AS 109 were also not made.
• Website Inactivity: The company’s website was inactive, preventing verification of statutory disclosures.

What the Numbers Show

The divergence between the reported revenue collapse and the relatively smaller decline in expenses suggests fixed cost pressures are disproportionately impacting profitability. While revenue fell nearly 89%, total expenses decreased only 67%, leading to a reversal from a net profit of ₹324.76 lakh in Q2FY24 to a loss of ₹132.99 lakh in Q2FY25. The absence of ECL provisions and unverified inventory balances raises concerns about the true quality of assets and potential hidden liabilities on the balance sheet.