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| ICAI to conclude probe on Satyam scam by year-end |
| BS Reporter / New Delhi Jul 02, 2009, 02:22 IST |
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Accounting and auditing regulator Institute of Chartered Accountants of India (ICAI) would come out with final conclusion on the role of statutory auditors in the Satyam scam only by the year-end.
According to ICAI President Uttam Prakash Agarwal, the final verdict by the institute’s disciplinary committee would be arrived at within six months. Meanwhile, the high-powered committee set up by the institute to probe the Satyam Computer fraud would submit its report to the ICAI council on July 9, said Agarwal.
This report would form the basis for taking possible disciplinary action against the former external auditors of Hyderabad-based Satyam Computers Ltd, where its founder confessed to inflating the company profits and fudging the accounts.
ICAI had sent showcause notices to two auditors of Price Waterhouse (PW), the Indian arm of PricewaterhouseCoopers (PwC), who were allegedly involved in the Rs 7,000-crore Satyam scam, which surfaced in January this year.
The two Price Waterhouse auditors were arrested by the Andhra Pradesh police later in the month for colluding with Raju in fudging the company’s accounts. One of the auditors, S Gopalakrishnan, is a senior council member of ICAI, while Srinivas Talluri is a member of ICAI.
Though Price Waterhouse gave its response to ICAI, the individual response by Goplakrishnan and Talluri is yet to be sent as both are behind bars. Both have been seeking extension from ICAI to give their responses.
The respondents (PW auditors) were given time till June 30 to reply to ICAI, Agarwal told reporters. He, however, declined to say whether the auditors had sought more time or not.
Tech Mahindra, an IT company, recently acquired 31 per cent share in Satyam at a total consideration of around Rs 1,750 crore. The company is now renamed as Mahindra Satyam.
ICAI is seeking more powers from the Ministry of Corporate Affairs (MCA) so that it can deal with Satyam-like scams in future. According to Agarwal, there is no time limit given in the ICAI Act for disposal of a case and this is one of the powers sought by ICAI. “We don’t want to give more adjournments to respondents and on the basis of information available the director (discipline) can arrive at a prima facie opinion on the occurrence of the alleged misconduct,” said Agarwal.
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