Moreover, SEBI put the charges of “Insider Training” on Raju and his family, and ordered him and his family to return Rs. As per the letter, the gap in the Company’s Balance Sheet had arisen purely on account of inflated profits over a period of last several years (limited only to Satyam standalone). (b) The forensic investigation also identified certain transactions aggregating Rs. It also provided for the other differences (net) of Rs. Of the above fictitious interest recognised, Rs. 2,933 Million. 9,964 Million), debtor balances (Rs. Pursuant to the above orders, the Ministry of Corporate Affairs (‘MCA’) – Government of India (‘GOI’), nominated 6 directors on the Board of the Company.
R. K. Gupta, managing director at Taurus Asset Management in New Delhi, told Reuters: “If a company’s chairman himself says they built fictitious assets, who do you believe here?” The fraud has “put a question mark on the entire corporate governance system in India,” he said. The CBI has filed a charge sheet against Mr. S.Gopala Krishnan and Mr. Talluri Srinivas, partners of PW, for committing offense of cheating, forgery, using forged documents as genuine, criminal conspiracy and falsification of accounts, fabrication of documents, among other offences punishable under law. Slowly and gradually as Satyam operation was getting intensified the gap between the actual figure and the fake figure started increasing and finally that gap gave birth to the huge amount, and due to the recession which aroused in the year 2008 a great slow down was observed in the real estate and the Raju’s plan of sharing of properties at good price with the hope to fill up the gap between the actual and the fake figures got failed. 64 Million. These primarily involved recognition of fictitious revenue and interest income, which ultimately resulted in creation of fictitious cash and bank balances and receivables. Raju admitted to major financial wrongdoings and talked about his last minute efforts to fill the “fictitious assets with real ones” through the failed Maytas acquisition.
The chairman, Ramalinga Raju, resigned as Chairman of SCSL after revealing that he had systematically falsified accounts as the company expanded from a handful of employees into a back-office giant with a work force of 53,000 and operations in 66 countries. After this, in June 2013, Mahindra Satyam got merged into Tech Mahindra. Moreover in order to be glued at a particular position they can even strangulate the rights provided to them. This article provides a case study on Satyam Computer Services Limited (SCSL). The irregularities were substantial in amount, perpetrated across multiple accounting periods and affecting many areas including inter alia revenue, foreign exchange gains, interest and other expenses with respect to the Profit and Loss account. The sub-paragraphs below detail the findings, effects and other matters relating to the financial irregularities of the earlier management headed by the erstwhile Chairman or the Raju management. Incorporated companies are like a shield , it’s a protective bubble around a corporation’s shareholders and directors. The SFIO has submitted its reports relating to various findings and has also commenced prosecution against the Company for two alleged violations before the Economic Offenses Court, Hyderabad against the Company and others. Moreover, it maintains flexibility in the company. The revelations could cause a major shake-up in India’s enormous outsourcing industry of India, analysts said, and may force many large companies to investigate and perhaps revamp their back offices. 182 Million, cash and bank balances by Rs.