MMTC Limited has submitted its unaudited financial results for the quarter ended June 30, 2026, along with a statement detailing an audit qualification. The qualification pertains to the non-recognition of an additional provision of ₹82.82 crore related to the Anglo Coal case, which the auditors believe should have been provided rather than disclosed as a contingent liability. Management, however, disagrees with this assessment.
Audit Qualification on Anglo Coal Matter
MMTC Limited has disclosed an audit qualification in its unaudited financial results for the quarter ended June 30, 2026. The qualification from the statutory auditors specifically addresses the accounting treatment of a matter involving Anglo Coal/Anglo American. The core of the qualification lies in the non-recognition of an additional provision amounting to ₹82.82 crore.
Details of the Qualification
The auditors highlight that in respect of the Anglo Coal case, an amount of ₹1088.62 crore was deposited with the Hon’ble Delhi High Court. While the company recognized a provision of ₹87.76 crore, the auditors believe a further provision of ₹82.82 crore was warranted. This has resulted in the provision being understated and contingent liabilities being overstated by the same amount. The auditors note this as a departure from accounting standards.
Management’s Response
Management, however, respectfully disagrees with the auditors’ qualification. They contend that considering the substantial accrued interest available against the deposited amount, no separate or incremental outflow of resources is expected. Therefore, they assess that the condition for recognizing a probable outflow of resources as per Ind AS 37 is not met. Management believes the amount was appropriately disclosed as a contingent liability, not requiring an additional provision on the reporting date.
Financial Impact Summary (Standalone)
The unaudited figures show a turnover of ₹146.12 crore and a net profit of ₹93.73 crore before adjustments. After the auditor’s adjusted figures, the turnover remains ₹146.12 crore, but the net profit significantly decreases to ₹10.91 crore. Total assets stand at ₹2532.79 crore, with net worth adjusted from ₹1834.36 crore to ₹1751.54 crore.
Financial Impact Summary (Consolidated)
For the consolidated results, turnover is also ₹146.12 crore, with net profit of ₹104.24 crore before adjustments. Adjusted figures show net profit at ₹21.42 crore. Total assets are ₹2964.9 crore, and net worth is adjusted from ₹2266.47 crore to ₹2183.65 crore.
Repetitive Nature
The document also indicates that this is a repetitive qualification, suggesting it has been a recurring issue in previous reporting periods.
Source: BSE
