SEBI Issues Administrative Warning to Cadsys Over Subsidiary Audit Report Non-Compliance
Cadsys (India) Limited has received an administrative warning from the Securities and Exchange Board of India (SEBI) regarding observations related to the auditing of its overseas subsidiaries. The warning, issued on June 25, 2026, relates to non-compliance with applicable provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.The core issue revolves around the certification status of financial statements and audit reports for certain subsidiaries that were included in the consolidated financial statements of Cadsys from FY 2019-20 to FY 2022-23. Specifically, the SEBI examination focused on the failure to ensure that these subsidiary documents were certified through Unique Document Identification Number (UDiN).
The overseas entities identified in the warning letter are Apex Advanced Technology LLC and Irish Tower LLC. The details regarding the required documentation lapse across the specified financial years are presented below:
| Subsidiary Name | Financial Years Affected |
|---|---|
| Apex Advanced Technology LLC | FY 2019-20, FY 2020-21, FY 2021-22, FY 2022-23 |
| Irish Tower LLC (step down subsidiary) | FY 2021-22, FY 2022-23 |
The SEBI examination noted that while the auditors acknowledged this deficiency when queried by the Exchange, such financial statements were nevertheless used for consolidation purposes. The regulations cited relate to the Audit Committee’s requirements regarding reviewing subsidiary audit reports and monitoring the effectiveness of the audit process.
Cadsys (India) Limited has been advised to ensure adequate diligence is exercised by its Audit Committee while reviewing financial statements and auditor reports from subsidiary entities before making any recommendations to the Board. The company must place this communication and outline corrective actions taken in the ensuing Board meeting, and forward comments back to SEBI within 15 days of receiving the warning.
CADSYS Stock Price Movement
On Monday, shares of Cadsys (India) Limited settled completely flat, finishing trading at ₹70.45 with no change from the previous session. The equity held steady as the stock concluded trading on Monday, mirroring its prior close.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
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