Satyam CAs, auditors may face severe punishment

punishment be given," ICAI President Ved Jain said after the financial wrong doings by India's fourth largest IT companyprocess of investigation, which is on," ICAI President Ved Jain told PTI.Following a letter from Satyam Chairman Ramalinga Raju, who accepted that he had misrepresented facts in the

were unearthed.

ICAI has said it will seek an immediate explanation from Satyam Computer's auditors, PriceWaterHouse Cooper, on the

financial fraud perpetrated?by the software company's chairman, B Ramalinga Raju, before taking any action.

"ICAI will write a letter to PwC tomorrow and will seek an immediate reply on the issue and inform them about the

He said that strict action will be taken if the auditors, of country's fourth largest IT firm Satyam, are found guilty.

PriceWaterHouseCooper, declined to comment on the issue.

company's balance sheet, the role of the auditors and accountants for the company has also come under the scanner.

In fact, the ministry of corporate affairs announced that the role of the directors and auditors at Satyam will be scanned by

ICAI and the apex body of company secretaries, ICSI.

Jain also pointed out that, before the body takes any action against the members involved in the "fraud", it needs to collect

all the facts and information. "We are looking into that and we will start our proceedings," he added.

Commenting on whether it was possible that the auditors were kept in the dark about the misrepresentation of the

accounts, Jain said it depends on the facts and circumstances of the case.

"As the information is tricking down to us, we need to examine what has really happened and how it has all happened," he

said.

About possible action against the auditors and/ or others party to the financial wrong doing, Jain said that under the Indian

Penal Code any person party to a fraud or cheating can be convicted.

"All one needs to prove is he was the party to the fraud. He can be booked under the Companies Act and the Chartered

Accountants Act... In case of negligence by the chartered accountant, we have severe punishment," Jain said.

?Meanwhile, the apex company secretaries body ICSI said that, at this stage, the body has not come into the picture. "If

any member found guilty, we will deal with it according to the company secretaries' law," ICSI President Keyoor Bakshi

said.

In the Company Secretaries Act, there is a provision for disciplinary action. If any member, Satyam's company secretary in

this case, is found guilty then the maximum ICSI can do is suspend membership, Bakshi added.

He also pointed out that the body has not yet asked for the report from the company and the report will come to them

Is the true and fair view done  ,what the auditors need to do.............

Satyam: Auditors' body to pull up PwC

The Satyam fiasco: Complete coverage

Such a huge fraud spanning over a period of time could not have gone unnoticed by the normal proceedures of verification. Even a ratio analysis could have revealed some irregularities and market players and fund managers should have scented something foul.  PWC again got into the credibility gap and this cannot be rectified by sending partners to Central Council.

The Securities and Exchange Board of India, the market regulator, said it was investigating.

"We have to go beyond this letter and find out what actually has happened," SEBI chief C.B. Bhave told reporters. "This is an issue which has very serious implications. It involves the Companies Act and the violation of the listing agreement with SEBI. It also raises the issue of authenticity of accounts that have been audited and certified by the auditors."

What do U say about SATYAM,ASATYAM?HIiGHLY PROFESSIONAL/PICK POCKETORS?

When Unfair Umpire(Regulator) will wake up and give equal oppurtunities to the Indian Investors?

Chartered Accountants should not be questions,Even if questions they being state accountant should not respond on account of maintain dignity of word "chartered" njoy by them.

When SATYAM falling FREE,Investors was not in a positions to write call contract for 30-40-50 ...................onwards,Was SEBI sleeping?who will ensure that the same call contract not written at all by anyone?

 PWC needs to be punished severely.I mean how can such a big FIRM which claims itself to be 1 of the BIG 4 do such a mess.How can auditors miss a 7000 crore scam and that to on a continuous basis.They have done fraud in cash and bank balances which is near to impossible because auditors check monthly bank balances,reconciliations and alos get a letter of confirmation from bank about bank balances,FD etc.PWC is very negligient and the auditor who has signed the balance sheet needs to be punished heavily.This will detroriate the image on Indian CAs and hurt us.I think now no FII,Institutional investors wil rely on any balance sheets signed by PWC auditors.I also think that many companies will now divert their appointment of auditors to other firms as PWC is no more credible.PWC u r down in the dumps.

Raju is doing unethical with investors

Mr.Sandeep Keswani is correct.

This is the begining but show must goes on.

The Satyam as it has revealed is bigger in volume than could have ever imagined....A Whopping 8000 crore fake numbers.

This primarily reveals that system of double entry is prone to manipulation if the auditors limit to balance-sheet audit.

The Scam has occured in current assets and liabilities section or working capital fraud!

Statutory auditors are primarily responsible for certifying fictitious cash balance and that is grave not only onaccount of apparent complicity but also a shame on an accountant expositing lack of primary knowledge reflecting the training he or she had in all these years.

The scam seems to be a tip of an iceberg not only for satyam but also the whole lot of corporates indulging in window dressing for years with complicity of auditors who become family members of the corporates.

The rectification is possible only if the law makers think of the following:

1.Audit rotation like the one done by C&AG and RBI.

2.Auditor rotation during audit periods determined in 1 above.

3.Independant audit profession regulator...like in many countries...ASIC,RSB,IRBA PCAOB.

4.Competition among accounting professionals with level playing field for cost accountants and others,(ASIC does that so do RQB).

5.SEBI taking over the role of accounting regulator.

6.Transperant reporting mechanism inclusive of operational details.

7.ICAI,ICWAI and ICSI powers should be clipped to being an education regulator(IPD and CPD) and other regulation should be through independant body which will include discipline compliance,standard setting,audit profession et al.

MCA should take immediate initiative on these line to restore investor confidence and stakeholderscomfort.

Client confidentiality or client culpability?

Let the CAs introspect today it is easy to develop so many guidelines standards and codes since ICAI most of it comes free from the western world,but when the sainiks(those in the battle ground)do not perform what is the use...auditors and accountants cannot afford to be with criminal mind-set.

ICAI should now think interms of producing qualitative members with good mind-set and not just money spinners.

Satyam seems to be the first case in a series that may exposite in the coming years!Can auditors plead ignorance?