sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
« ICAI »
 Special discount for Professional Accountants of South Asian Region for registering in the World Congress of Accountants (WCOA), 2018 from November 5-8, 2018, Sydney, Australia
 Launch of Batch of Educational Course by ICAI Registered Valuers Organsiation (ICAI RVO) at ICAI Jaipur from 14th July, 2018 to 11th August, 2018
 Launch of Batch of Educational Course by ICAI Registered Valuers Organsiation (ICAI RVO) at ICAI Jaipur from 14th July, 2018 to 11th August, 2018
 Announcement for the Certificate Course on NPO at Noida from 14th July 2018
 Advanced Integrated Course on Information Technology and Soft Skills (Advanced ICITSS) - Information Technology Test
 All members having certificate of practice, please click here to submit important information to ICAI - Last date for online submission is 30th June 2018.
 Selection of 1000 Young Members as Speakers for Programmes.
 Annual Improvements to Ind AS (2018) (Corresponding to Annual Improvements to IFRS Standards 2015–2017 Cycle issued by the IASB)
 Plan Amendment, Curtailment or Settlement (Amendments to Ind AS 19, Employee Benefits)
 Prepayment Features with Negative Compensation (Amendments to Ind AS 109, Financial Instruments)
 Long-term Interests in Associates and Joint Ventures (Amendments to Ind AS 28)

1,200 listed Indian companies misrepresented facts: Icai survey
September, 18th 2008

At least 1,200 companies listed on Indias stock exchanges, which include some 25-30 firms on the benchmark Sensex and Nifty indices, have massaged financial statements to beat market expectations.

That is the conclusion from a study, called Early Warning Signals of Corporate Frauds, which alleges that such improper accounting includes deferring revenue, inflating expenses and avoiding taxes.

The studyconducted by the Institute of Chartered Accountants of India (Icai), and Indiaforensic Consultancy Services, a Pune-based forensic accounting and education firmstarted early this year and ended in August.

The study examined 4,867 companies listed on the Bombay Stock Exchange and 1,288 companies listed on the National Stock Exchange, as on March 2007.

The surveys respondents were 340 chartered accountants who are members of Icai, the regulator for auditors, and some chartered accountancy students.

As many as 73% of the studys respondents said the motive for committing accounting statement frauds was to exceed expectations of stock market analysts. For unlisted firms, such frauds are typically carried out to avoid taxes, attract foreign investments and mobilize funds from banks, the survey says.

Accounting fraud is the most egregious fraud because it goes against the basic concept of investor confidence in financial statements, said Vidya Rajarao, executive director of financial advisory services at consultancy PricewaterhouseCoopers. If these are manipulated then there is no other information which is trustworthy.

The study investigated 11 sectors that include real estate, retail, banking, manufacturing, insurance, public sector undertakings, mutual funds, transport and warehousing, media and communications, oil and gas and information technology.
The manufacturing sector, which contributes about 28% of Indias gross domestic production, is the most ridden with fraud, said 20% of the auditors who responded to the survey, largely because of the peculiar nature of the business and the procedural complexities. Realty and public sector undertakings came second.

Vijay Kewalramani, a Mumbai-based independent chartered accountant who participated in the survey, said a lack of enforcement in manufacturing leads to misreporting by firms. Regulations in sectors such as banking and insurance are stringent and it leaves little opportunity for frauds,?he said. However, in manufacturing the regulations are hardly strict and there is a lack of enforcement.

Some 25% of respondents said between 20% and 30% of their clients manipulate financial statements. The report also cited as alarming the reluctance of companies to report incidence of fraud.

Indiaforensics chief research officer Apurva Pradeep Joshi said the survey was done as part of research to identify a set of exceptional transactions that will act as benchmark for industry and help reduce losses to organizations.
This benchmark will help businesses in reducing losses caused by financially fraudulent activities, Joshi said.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Internet Marketing Website Marketing Internet Promotion Internet Marketing India Website Marketing India Internet Promotion India Internet Marketing Consultancy Website Marketing Consulta

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions