IZMO review relies on unaudited foreign subsidiary accounts

IZMO Limited’s limited-review report says foreign subsidiaries contributed Rs 99.44 crore of Rs 131.73 crore consolidated half-year revenue ended September 30, 2026 using management-certified, unaudited accounts; their Rs 25.01 crore net profit after tax was higher than the group’s Rs 24.69 crore.

How much of IZMO’s consolidated results came from foreign subsidiaries?

Foreign subsidiaries supplied Rs 99.44 crore of IZMO’s Rs 131.73 crore consolidated revenue from operations for the half-year ended September 30, 2026, or about 75% of the reported group total. Their results showed Rs 25.01 crore of net profit after tax, compared with consolidated net profit after tax of Rs 24.69 crore.

The foreign-subsidiary profit was Rs 31.19 lakh higher than the group’s reported profit, reflecting the combined effect of the parent, the Indian subsidiary and consolidation entries within the reported group result. The filing does not provide a reconciliation that identifies the individual effects of those entities or consolidation entries.

The auditor said the overseas figures were based on management-certified accounts provided to the auditor. The report further states that the conclusion on the consolidated statement, insofar as it relates to those subsidiaries’ affairs, is based solely on their unaudited financial results and other unaudited financial information. Operations outside those disclosed foreign subsidiaries accounted for Rs 32.30 crore of the group’s half-year revenue.

What did the limited-review auditor say about IZMO’s accounts?

The auditor said the foreign-subsidiary results included in IZMO’s half-year consolidated financial results were unaudited and management-certified rather than audited or reviewed by the reporting auditor. The limited-review report is dated November 13, 2026 and covers the consolidated statement for the quarter ended September 30, 2026, including the half-year results.

The report says a limited review provides moderate assurance and is narrower than an audit. Its procedures are primarily inquiries of company personnel and analytical procedures applied to financial data; the auditor explicitly said no audit was performed and no audit opinion was expressed. Based on the review, the auditor said nothing had come to attention indicating that the statement did not meet applicable Indian Accounting Standards or contained a material misstatement.

The group perimeter includes one Indian subsidiary, Izmo Microsystems Private Limited, and several overseas entities, including Izmo Europe BVBA, Izmo Inc, US, Midrange Software Pte Ltd., Izmo France SARL, Frog Data LLC and Izmo Technologies GmbH. The filing also says Izmo Consulting was dissolved on April 30, 2026, but it does not disclose individual revenue or profit figures for the foreign entities that together reported Rs 99.44 crore of revenue.

Which IZMO balances remain subject to confirmation?

IZMO’s auditor said balances of sundry debtors, inventories, loans and advances, and current liabilities remain subject to confirmation and reconciliation as at September 30, 2026. The filing does not quantify the portion of any such balance that remains unconfirmed or unreconciled, and it does not state that an adjustment has been recorded.

The consolidated balance sheet reported trade receivables of Rs 144.41 crore at September 30, 2026, up from Rs 129.05 crore at March 31, 2026. Inventories rose to Rs 86.17 lakh from Rs 29.59 lakh, while other current liabilities increased to Rs 64.19 crore from Rs 54.24 crore over the same period.

The consolidated cash-flow statement records a Rs 15.36 crore increase in trade receivables and a Rs 25.88 crore increase in short-term loans and advances during the half year ended September 30, 2026. It also records a Rs 13.84 crore increase in current liabilities and provisions, producing Rs 7.83 crore of cash generated from operations and Rs 7.39 crore of net operating cash flow after Rs 44.47 lakh of direct taxes paid.

How did IZMO’s consolidated performance change?

IZMO reported revenue from operations of Rs 131.73 crore for the half year ended September 30, 2026, up from Rs 116.62 crore in the corresponding 2025 half year. Net profit after tax increased to Rs 24.69 crore from Rs 18.56 crore, while profit before tax rose to Rs 25.33 crore from Rs 19.17 crore.

Total expenses increased to Rs 108.49 crore in the 2026 half year from Rs 102.86 crore a year earlier. Employee benefit expense rose to Rs 58.23 crore from Rs 55.93 crore, while other expenses increased to Rs 36.68 crore from Rs 34.17 crore.

In the September 2026 quarter, revenue rose from Rs 65.38 crore in the June 2026 quarter and from Rs 60.11 crore a year earlier. Quarterly net profit after tax was Rs 12.50 crore, above Rs 12.20 crore in the preceding quarter but below Rs 12.56 crore in the September 2025 quarter.

Consolidated cash and cash equivalents stood at Rs 9.08 crore at September 30, 2026, down from Rs 10.29 crore at March 31, 2026. Total assets increased to Rs 532.39 crore from Rs 493.82 crore, while total equity increased to Rs 435.43 crore from Rs 408.97 crore.

Conclusion

IZMO’s half-year consolidated outcome depended substantially on overseas operations, which supplied about three quarters of Rs 131.73 crore revenue and reported Rs 25.01 crore of net profit after tax. The limited-review report makes clear that these foreign-subsidiary figures were management-certified and unaudited, while specified working-capital balances remained subject to confirmation and reconciliation.

The unresolved confirmation and reconciliation of sundry debtors, inventories, loans and advances, and current liabilities is the next disclosed matter to watch. The November 13, 2026 report gives no timetable for completing those procedures, despite consolidated trade receivables of Rs 144.41 crore at September 30, 2026.