Bail petitions of former PW executives rejected

The IV additional metropolitan sessions court today denied bail to the former Price Waterhouse (PW) auditors S Gopalakrishnan and Srinivas Talluri.

The two auditors are in jail after they have been arrested in connection with the Rs 7,800-crore financial scam at the Satyam Computer Services. The arguments for the bail petition began yesterday and continued today.

The CBI stressed that the PW auditors had conspired with Satyam founder B Ramalinga Raju, his brother B Rama Raju and former chief financial officer Srinivas Vadlamani certified the balance sheets and profit and loss statements and caused financial loss to small investors and shareholders.

The auditors have grossly failed complying with standard auditing practices, which amounted to professional misconduct.

PW India expressed disappointment that the two partners who worked on the audit of Satyam's financial statements have again been denied bail.

"The fraud perpetrated by Raju and his cohorts was designed to, and did, circumvent PW India's audit process. The two partners were also victims of that substantial and elaborate fraud," PW stated in a press release.

The two partners, who are committed to cooperating with all investigating authorities, have now been held in custody for over 10 weeks. During this time, the partners have consistently denied any criminal wrongdoing, the audit firm pointed out.

Even though it has seen no evidence of wrongdoing on their part, PW said that it had suspended both the partners from all duties in January, pending resolution of the Satyam investigations, as it was "committed to the highest standards of quality and service for its clients".