International BusinessDeloitte applies to become Mahindra Satyam auditor
Board, audit panel to meet on September 4.
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Global auditing firm Deloitte wants to become the statutory auditor of scam-hit Satyam Computer Services (rebranded as Mahindra Satyam to reflect its new ownership by Tech Mahindra), according to T N Manoharan, one of the two government-appointed directors retained on the board of the company.
“The six-member board and the auditing committee of Satyam will meet in Hyderabad on September 4, where KPMG will make a presentation on the progress made by its forensic investigation experts on the company’s previous years’ financials. The issue of appointing statutory auditors, too, will come up at the meeting and Deloitte is also in the list for consideration,” he said.
Two officials (S Gopalakrishnan and Srinivas Talluri) of the earlier book keepers, Price Waterhouse, were arrested in January in connection with the financial fraud confession by Satyam founder B Ramalinga Raju.
After this, PW resigned in February from its role as statutory auditor. In July, the board of Mahindra Satyam received a nod from the Company Law Board to appoint a statutory auditor for 2009-10.
Speaking on the sidelines of the 41st regional conference of the Southern India Regional Council of the Institute of Chartered Accountants of India (ICAI) here on Sunday, Manoharan, former president of ICAI and also chairman of the Satyam audit committee, said: “Since the new strategic investor (Tech Mahindra) came in with capital and a structured management, the role of C Achuthan and me has been confined to only overseeing the compliance of the takeover conditions. The CLB has not indicated any time period for us to remain on the board.”
Earlier, during the course of his address today at the ICAI meet, ‘Jnana Yagna’, Manoharan narrated the challenging situations that the six government-nominated directors underwent, from the day they were appointed to the board to April 13, when Tech Mahindra was declared the highest bidder for Satyam.
“When I first landed in Hyderabad as a government-nominated board member, I was received by a travel agency car. It was a red-carpet welcome. However, the cab driver told me, ‘Three months’ bills pending, Sir, kindly do something!’ Then we realised what the situation was,” he recalled.
“We worked 24x7, meeting clients and infusing some confidence, so that project continuity was ensured. Our next task was to find a new owner and our options were twofold – find an investor through a bidding process or continue the company like it is, get accounts restated, provide due diligence and then give it to a new owner. We had invited online applications and received 141 registrations. However, most of our responses bounced back, making us realise that many of them were fictitious,” he added.
Mentioning an executive’s question a week before April 13, when he was addressing the Oracle division of Satyam, Manoharan said. “It was a mind-boggling one to me. While appreciating all the work that we were doing, the executive asked us what we would do if no bidder emerges. With a smiling face, I responded ‘Don’t worry, we have planned it. But I really didn’t know what that plan is.”
“However, what appeared to be humanly impossible, the entire process of turnaround, was made possible in 97 days.”