Satyam audit reports may be deemed unreliable: PwC
January, 15th 2009
Price Waterhouse, auditors of Satyam for over eight years, has informed the scam-ridden IT firm's new board that its audit of the company's financials could be "inaccurate and unreliable" in view of the financial irregularities disclosed by Ramalinga Raju.
Noting that it has been auditing Satyam Computer since the quarter ended June 2000 till September 2008, Price Waterhouse said that all those financial statements were prepared by the management.
It further said that it relied "on management controls over financial reporting, and the information and explanations provided by the management, as also the verbal and written representations made to us during the course of our audits."
Satyam as well as PwC are the subject of regulatory and government investigation into the country's biggest corporate fraud - involving Rs 7,800 crore - disclosed by Satyam founder Ramalinga Raju. Raju, his brother Rama Raju and Satyam CFO Vadlamani Srinivas are in judicial custody now.
"We hope to work with the company and provide assistance to the new board of directors to address any issues that arise in the course of such investigations to enable both the company and us as your statutory auditors to fulfil obligations under applicable law."
Copies of the letter, dated January 13, were also sent to RoC Hyderabad, SEBI, RBI, Central Board of Direct Taxes, BSE, NSE and NYSE.