Sebi slaps ₹10 lakh penalty on Coffee Day for financial misstatements

Sebi has fined Coffee Day Enterprises and nine individuals for alleged financial misstatements, stating the company understated losses by not accounting for over ₹489 crore in interest expenses

The Securities and Exchange Board of India (Sebi) on Monday imposed penalties on Coffee Day Enterprises and nine others, including current and former directors and key managerial personnel, for alleged financial misstatements.

 

The penalty on Coffee Day is ₹10 lakh, while the penalty on others ranges from ₹5 lakh to ₹1 lakh each.

  The investigation period by Sebi covered financial statements for the financial year 2019–20 to FY24 and financial results for FY20 to Q2FY25.

 

In an adjudication order issued on Monday, the regulator held that the company understated its reported losses by not accounting for interest expenses aggregating ₹489.49 crore, which it said were in violation of the accounting standards.

 

 

The company had submitted that it had disclosed in the annual reports and quarterly results that it had not accounted for the interest expenses. However, Sebi noted that merely making disclosures of non-compliances in the financial statements did not absolve the company of the non-compliances.