Cerebra auditors disclaim conclusion on September 2026 results

Cerebra Integrated Technologies Limited’s auditor disclaimed a conclusion on the unaudited standalone results for the quarter and half year ended September 30, 2026, after it could not obtain sufficient appropriate evidence, including over Rs 142.63 crore of trade receivables. YCRJ & Associates also identified material uncertainty over Cerebra’s ability to continue as a going concern.

Why did Cerebra’s auditor disclaim a conclusion on the results?

Cerebra’s auditor disclaimed a conclusion because the matters identified were substantive and significant enough to prevent it from obtaining sufficient appropriate evidence. YCRJ & Associates said it could not form a conclusion on whether the standalone financial statements for the quarter and half year ended September 30, 2026 complied with Indian Accounting Standards and disclosure requirements under Regulation 33 of the Securities and Exchange Board of India listing regulations.

The report was a limited review rather than an audit opinion, and it was dated November 12, 2026. A limited review is based mainly on inquiries of company personnel and analytical procedures, giving less assurance than an audit; however, the auditor said it still could not establish whether adjustments were required for several material balances reported by Cerebra.

Cerebra’s Board approved the unaudited standalone results on November 12, 2026. The company reported one operating segment, e-waste recycling and refurbishment, under Indian Accounting Standard 108, Operating Segments, meaning the results and review observations apply to its sole disclosed reportable segment.

What going-concern risks did Cerebra’s auditor identify?

Cerebra’s auditor said the reported conditions created material uncertainty that may cast significant doubt on the company’s ability to continue as a going concern. It cited significant operating losses in the current and earlier financial years, workforce reductions, cessation of key operations including refurbishment activities, lower revenue, and challenges in servicing current liabilities and settling income-tax dues.

The auditor said it could not obtain sufficient appropriate evidence supporting management’s assessment that the going-concern basis of accounting was appropriate as at September 30, 2026. Cerebra had filed an application on June 15, 2026 before the National Company Law Tribunal, Bengaluru Bench, to initiate the Corporate Insolvency Resolution Process, or CIRP, under Section 10 of the Insolvency and Bankruptcy Code, 2016; the application remained pending at September 30, 2026.

Cerebra reported a loss before tax of Rs 31.6249 crore for the half year ended September 30, 2026, compared with a loss of Rs 28.333 crore in the corresponding half year of 2025. Its loss after tax increased to Rs 30.2208 crore from Rs 23.7492 crore, while revenue from operations fell to Rs 35.01 lakh from Rs 3.997 crore.

Which receivables and advances could Cerebra’s auditor not verify?

Cerebra’s auditor could not obtain sufficient appropriate evidence for Rs 142.63 crore of trade receivables as at September 30, 2026. Of that total, Rs 142.46 crore had been outstanding for more than one year, and although Cerebra had made a doubtful-debt provision for receivables outstanding beyond one year, the balances remained subject to confirmation.

The review report does not state that the Rs 142.63 crore receivable balance is incorrect. Instead, it says the auditor could not determine whether adjustments to the carrying value and the consequential effect on the September 2026 financial statements were necessary because sufficient evidence on the balance was unavailable.

A separate matter involved Rs 100.28 crore recoverable from an overseas party, comprising Rs 15 crore under other current assets and Rs 85.28 crore under other non-current assets. The dues relate to consideration for Cerebra’s March 17, 2022 sale of former subsidiary Cerebra Middle East FZCO, Dubai, and settlement of advances from that former subsidiary; the contractual payment period had expired and the balances were overdue by more than two years.

Cerebra made an ad hoc provision of Rs 21.32 crore against the overseas-party dues. The auditor said the balances were subject to confirmation and had not been restated under Indian Accounting Standard 21, The Effects of Changes in Foreign Exchange Rates, and it could not assess recoverability, provision adequacy, the impact of the non-restatement, or compliance with applicable regulatory requirements.

What other reported balances lacked sufficient evidence?

Cerebra’s auditor also could not comment on the carrying value of Rs 5.98 crore of loans and advances due from a subsidiary for more than three years. The subsidiary’s auditors had raised concerns about its going-concern status because its net worth had been completely eroded, while Cerebra had not made an expected-credit-loss provision for the loan or its Rs 3.5 lakh investment in the subsidiary’s equity shares.

The report further identified Rs 20.30 crore of capital advances and other advances paid to various parties. This total comprised Rs 10.81 crore in current assets and Rs 9.49 crore in non-current assets, had remained outstanding for more than one year, and was subject to confirmation; Cerebra had made an ad hoc provision of Rs 46 lakh.

Cerebra also did not provide bank statements for two accounts maintained with Canara Bank and Bank of India. The auditor said it could not verify the balances, transactions and bank reconciliations for these accounts, and could not perform alternative procedures to establish the existence, completeness and accuracy of the related reported amounts as at September 30, 2026.

How did Cerebra’s September-quarter performance change?

Cerebra reported a loss after tax of Rs 23.7647 crore for the quarter ended September 30, 2026, compared with a loss of Rs 6.4561 crore in the June 2026 quarter and Rs 9.6479 crore in the September 2025 quarter. The September 2026 quarter included an exceptional provision for doubtful loans and advances of Rs 21.7876 crore, which was not reported in either comparison quarter.

Revenue from operations was Rs 2.75 lakh in the September 2026 quarter, down from Rs 32.26 lakh in the preceding June quarter and Rs 2.2065 crore a year earlier. Finance costs fell to Rs 1.6027 crore from Rs 1.9769 crore in June 2026 and Rs 1.875 crore in September 2025, while employee-benefit expense was Rs 18.42 lakh compared with Rs 18.12 lakh and Rs 39.91 lakh, respectively.

Cerebra reported total equity of Rs 67.8763 crore at September 30, 2026, down from Rs 98.0971 crore at March 31, 2026. Current liabilities increased to Rs 100.5169 crore from Rs 96.6301 crore, while current tax liabilities rose to Rs 38.1647 crore from Rs 36.918 crore over the same period.

Conclusion

Cerebra’s September 2026 standalone results carry a disclaimer of conclusion because its auditor could not obtain sufficient appropriate evidence on going concern, receivables, overseas dues, advances and two bank accounts. The reported operating trend showed half-year revenue falling to Rs 35.01 lakh from Rs 3.997 crore, while the half-year loss after tax rose to Rs 30.2208 crore from Rs 23.7492 crore.

The next disclosed matter to watch is Cerebra’s CIRP application, filed on June 15, 2026 and pending before the National Company Law Tribunal, Bengaluru Bench at September 30, 2026. Subsequent reporting will also show whether Cerebra provides confirmations, bank records, evidence on recoverability, foreign-exchange restatement support and documentation for management’s going-concern assessment.