ALSO READSatyam scam: Price Waterhouse moves SAT against Sebi's two-year ban ruling Sebi bans Price Waterhouse in Satyam case: All you need to know 9 years after Satyam scam, Price Waterhouse banned from audit for 2 years Ministry of Corporate Affairs to review Sebi's Price Waterhouse order Lessons from Satyam
The Securities Appellate Tribunal (SAT) on Friday refused to grant a stay on market regulator Securities and Exchange Board of India (Sebi’s) order against global audit firm Price Waterhouse (PW), for its alleged involvement in the Satyam fraud case.
PW and its network firms "shall not take new assignments and new clients", SAT said during the first hearing in the matter. Further, the audit firm was asked to submit a list of its existing clients before the tribunal and furnish a copy to Sebi as well, SAT said during the first hearing in the matter.
The market regulator had, on January 10, banned the audit firm under the audit brand PW from providing audit services to listed companies and market intermediaries for two years for its alleged involvement in the Satyam fraud case. Two PW partners have been banned for three years.
PW had challenged the matter at the appellate tribunal and sought a blanket stay on the regulator's order.
ALSO READ: 9 years after Satyam scam, Price Waterhouse banned from audit for 2 years
The tribunal has, however, provided relaxation to PW, allowing it to continue its relationship with its existing clients. It said that the Sebi order will not affect the existing clients in the following calendar year. “The said order shall not come in the way of audit assignments undertaken by PW and it network firms for fiscal 2017-18," SAT said.
The next hearing in the matter is scheduled for February 13. Meanwhile, Sebi has been asked to furnish its response on February 8.
Further, the audit assignments that have already been undertaken by PW for clients who follow the financial year beginning on January 1, 2018 would not be impacted either, noted SAT. It said that PW has the liberty to complete any other work of certification other than audit," SAT said.
The regulator in the order had also imposed a disgorgement of Rs 130.9 million on PW and two of its chartered accountants, S Gopalakrishnan and Srinivas Talluri. The three entities also have to pay 12 per cent interest on the disgorgement amount starting January 7, 2009, within 45 days from the date of the order.
The case dates back to 2009, when the then chairman of Satyam Computer Services (Satyam) B Ramalinga Raju admitted and confessed to large scale financial manipulations in the company's book of accounts to the tune of Rs 50.4 billion. Soon after this, Sebi initiated investigations and later on issued showcause notices to PW and its associates in February 2009. Further notices were issued to PW in 2012 under FUTP (Fraudulent and Unfair Trade Practices) regulations.