California Software Reports Q1 FY26 Results Amid Auditor Concerns
California Software Company Limited announced unaudited Q1 FY26 results with consolidated revenue of Rs 154.59 crore, up 43.6% YoY but down 22.3% QoQ. Net profit reached Rs 19.32 crore, slightly up from Q1 FY25 but down from Q4 FY25. The company's auditors, K. Gopal Rao & Co., issued a qualified review report highlighting concerns including long-standing trade receivables, unconfirmed payables, and discrepancies in financial reporting. The subsidiary, Aspire Communications Private Limited, reported nil revenue and profit for the quarter.
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California Software Company Limited , an IT and software development firm, has announced its unaudited financial results for the first quarter, revealing a mixed performance accompanied by several auditor qualifications.
Revenue and Profitability
The company reported a consolidated revenue from operations of Rs 154.59 crore for Q1 FY26, marking a 43.6% increase from Rs 107.63 crore in the corresponding quarter of the previous year. However, this represents a 22.3% decrease from Rs 198.95 crore in the preceding quarter.
Net profit for the quarter stood at Rs 19.32 crore, showing a slight improvement from Rs 17.33 crore in Q1 FY25, but a significant decline from Rs 29.55 crore in the previous quarter. The basic earnings per share (EPS) for the quarter was Rs 0.03.
Financial Performance Breakdown
| Particulars (Rs in crore) | Q1 FY26 | Q4 FY25 | Q1 FY25 | FY25 |
|---|---|---|---|---|
| Revenue from Operations | 154.59 | 198.95 | 107.63 | 544.64 |
| Total Expenses | 128.48 | 160.47 | 84.21 | 444.80 |
| Profit Before Tax | 26.10 | 38.48 | 23.42 | 99.84 |
| Net Profit | 19.32 | 29.55 | 17.33 | 71.94 |
Auditor Qualifications
K. Gopal Rao & Co., the company's auditors, issued a qualified review report highlighting several concerns:
- Long-standing trade receivables of Rs 1,977.28 crore without adequate provision for expected credit loss.
- Unconfirmed trade payables amounting to Rs 328.45 crore.
- Lack of age-wise details for current assets and liabilities.
- Unreconciled current tax (net) balance of Rs 380.02 crore.
- Discrepancies in opening balances compared to the previous year's audited statements.
- Absence of a Fixed Asset Register, raising questions about the accuracy of the Rs 212.44 crore fixed asset balance.
Subsidiary Performance
The company's subsidiary, Aspire Communications Private Limited, reported nil revenue and profit for the quarter, as per the consolidated financial results.
Management Commentary
Dr. Vasudevan Mahalingam, Managing Director of California Software, stated, "While we have seen year-on-year growth in our revenue, we acknowledge the challenges highlighted by our auditors. We are actively working to address these concerns and strengthen our financial reporting processes."
The company's board meeting, which approved these results, was held on August 14, 2025, commencing at 16:00 hours and concluding at 20:00 hours.
California Software continues to operate primarily in the IT and software development sector, with no separate reportable segments as per Ind AS 108 on "Operating Segments."
Investors and stakeholders are advised to consider the auditor's qualifications while assessing the company's financial performance for the quarter.
Historical Stock Returns for California Software - PP
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -3.30% | -10.59% | -13.75% | +52.43% | +4.52% | +4.52% |
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