ICAI to seek explanation from Satyam Computer auditors

 Richard Rekhy, COO, KPMG in India

The Institute of Chartered Accountants of India will do an investigation of its own to check whether there was an audit failure. The council has its own disciplinary committee that will see whether adequate due diligence was ensured by the auditor.

An independent investigating agency can probe the role of the senior management, the banks, other directors, because the amount involved is also too huge.

Since it is an SEC-registered company, there will be an independent investigation from the US also. Overall, I think it is a loss of reputation for the accounting profession and will also throw up the role of independent directors in the whole matter.

Suresh Surana, chairman, RSM India

It needs to be ascertained whether any documentary evidence was presented to the auditors, on whether that was forged. Also since it is regarding large sums of money, what was the role of the banks?

This would now show that there is too much focus on the short-term performance of a company, on quarterly performance. This is sometimes at the expense of the long term status of the company.

It is not one individual, but the entire firm is responsible. All the people in the firm is who is involved in accepting the audit work should take responsibility. It is no meaning by making an individual as skapegoat.

NEW DELHI: In the wake of the revelation of the major financial fraud by India's fourth-largest IT firm Satyam Computer, the accounts and balance sheets of other companies could come under apex accounting body ICAI's scanner. 

"The ICAI will initiate the process of looking into the accounts of other companies," Ved Jain, President, Institute of Chartered Accountants of India (ICAI), said. 

The institute has a financial reporting review board, which can look into accounts of other companies as well any irregularities and "frauds", he said. 

The Satyam case has given the ICAI the idea of looking into the accounts of other major companies to ensure that companies follow the highest standards of corporate governance. 

"It is a matter of concern that such a large firm (Satyam) can do such a grave fraud," Jain said. 

Following a letter from Satyam Chairman Ramalinga Raju, who accepted that he had misrepresented facts in the company's balance sheet, the role of auditors and accountants of the company has come under scrutiny. 

The Ministry of Corporate Affairs announced that the role of directors and auditors at Satyam will be probed by the ICAI and the apex body of Company Secretaries ICSI. 

Satyam Computer, listed on the Indian and US bourses, had shown inflated profits by misrepresenting financial details.

sec:https://economictimes.indiatimes.com/articleshow/3948295.cms

The auditors to be arrested immediately, without any doubt and question. What explanation, comments, bla bla etc.

The auditors have certified or kept quiet about sept08 quarterly accounts. They directly helped the CEO to cheat investors funds. Even the bank balances did not match.

The auditors must be arrested. Then only the public will respect CA;s and ICAI.

But i know ICAI or SEBI or MCA will apooint a committe and that committe will submit its report in year 2015.

I wonder today morning Southern railways have awared a work contract for Rs.115 crore to MAYTAS.

ICAI or SEBI or MCA should also investigate the accounts, audit reports of MAYTAS also.