Satyam: Inflated Employee Count

HYDERABAD: Satyam’s 53,000 employees are also inflated like the company’s cash reserves to siphon off funds in the name of non-existent 

Different shades of Satyam Top Accounting scandals The crux of the scam in Satyam

associates , say analysts now looking at the company with a scanner. “The figure of 52,865 associates could actually be a much smaller number, with the additional numbers used for ‘‘ other purposes.’’ 

Sources say that two years ago the company was aiming at a headcount of 80,000 by Q1 2009 and Raju’s ambition to turn Satyam into a multicultural enterprise helped the firm fudge employee figures. 

‘‘ Setting up offices in nations such as China and Malaysia required the company to ensure 80 per cent of the employees were local. There was probably some fudge happening there,” said a former HR manager of Satyam. He added: ‘‘ Few years ago Satyam was planning to set up offices in various other nations such as Mexico, Sweden, Brazil and was hiring students from those countries. All these added to the headcount confusion.’’ He said that data collection and updation weren’t exactly a Satyam strength. 

Besides, another source familiar with the company’s HR said that while the company has development centres in various locations such as Malaysia, South Africa and Egypt, the headcounts there are not very clear, particularly in the case of interns. 

‘‘ The salaries for training of interns in centres such as Malaysia are paid by the local government there and not Satyam but they reflect in the company’s payrolls ,’’ says the source. Explaining this Malaysian government-Satyam arrangement, the source said, ‘‘ It was an HR initiative to develop skilled manpower in association with the local governments.’’ 

Pertinently, Satyam writes on each of its mailers that the figure of 52,865 was valid as on September 30, 2008. Apart from the massive lay off exercise conducted by the company in the last quarter of 2008 which would have shrunk the numbers by a few thousands, bankers say they have a serious doubt on the veracity of the initial claim itself. ‘‘ 

This was one way of siphoning off the company money. But how do you prove it? These bank accounts would be there on the names of employees but the operators of these accounts could have been somebody else,’’ says a senior banker. 

The company, bankers say, ‘‘ lack coordination and centralisation of data’’ . While the number of employees on the company’s address book as on January 9 showed 47,570, a figure that has remained consistent for the last month, sources say that the figure does not take into account the number of people who were fired or had left the firm.