The Securities and Exchange Board of Asian nation (SEBI) late on Wednesday barred worth Waterhouse from auditing listed firms within the country for 2 years, when a research into a virtually decade-old accounting fraud case during a package services company that became India’s biggest company scandal.
Ramalinga Raju, founder and former chairman of the erstwhile package services bourgeois Satyam pc Services, surprised Indian markets and investors in Jan 2009, once he admitted that the firm had overdone earnings and assets for many years, during a fraud of over $1 billion generally remarked as “India’s Enron”.
Price Waterhouse was Satyam’s auditor throughout the amount during which the fraud was perpetrated.
In its order, the SEBI, on Wednesday same any entities or corporations active as hired accountants in Asian nation below the complete and banner of PW, shall ultimately or indirectly issue any certificate of audit of listed firms, or their intermediaries that are registered with the regulator for a amount of 2 years.
“The network structure of operations adopted by the international business firm shouldn't be used as a defend to avoid legal implications arising out of the certifications issued below the brand of the network,” SEBI same during a108-page order.
In India, all audit functions among the cluster are conducted below the value Waterhouse (PW) complete, with a network of native corporations operative below the banner.
The broader PwC entity handles consulting, tax consultive and different businesses.
“The SEBI order relates to a fraud that befell nearly a decade agone during which we tend to compete no half and had no information of,” worth Waterhouse same during a unharness.
“There has been no intentional wrong doing by PW corporations within the unexampled management perpetrated fraud at Satyam, nor have we tend to seen any material proof to the contrary,” same worth Waterhouse, adding it absolutely was assured of obtaining a court to remain the order before it becomes effective.
To avoid operational difficulties, SEBI same its order won't impact audit assignments regarding the continuing 2017-18 year, already undertaken by corporations forming a part of the PW network.
SEBI additionally ordered worth Waterhouse, Bangalore and to of its erstwhile partners to together forfeit “wrongful gains” of regarding 131 million rupees ($2.06 million) and interest among forty five days.
Indian IT firm technical school Mahindra, a part of the Mahindra cluster, bought management of Satyam in an auction in Apr 2010.
Satyam and PricewaterhouseCoopers united in 2011 to pay a combined $17.5 million to settle U.S. probes into the accounting fraud.
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