A-Satyam
Satyam financial scandal is result of loopholes in current system of appointment and auditing done by “Independent” auditors.
Satyam Computer Services Ltd is in top 4 IT company in India and its auditors Price Waterhouse Coopers (PWC) are also in ‘so called’ top 4 auditing firm in the world. That means both entities have competitive advantage and so have brilliant human resources (as they claim!). How such kind of financial scandal will take place when such excellent, topnotch people are within and around Satyam? (Of course, brilliants does not always mean integral, fair and impartial)
No doubt the top management is responsible and accountable to this financial scandal, but the independent auditor is also equally responsible. The fraud size (i.e. Rupees 7000 crores) remains undetected after applying generally accepted auditing procedures by Independent Auditor is not acceptable. The problem seems to be in current system of appointing auditors and concentration of auditing practice (specially in case of listed entities) in few hands.
Government of India and ICAI should take immediate steps to rationalize the appointment of auditors. There is concentration of auditing business in few hands. These so called “big 4” foreign auditing firms ready to do whatever to retain clients.
On the other side many brilliant and hardworking CA’s are struggling hard for their survival. There is uneven distribution of auditing and related work among auditing firms.
Government of India or/and ICAI need to fix policy and methods, so that auditing and related work available in India is distributed/allocated among all eligible CA’s.
After all, all CA’s are equal in the eyes of law (i.e. on paper), ICAI need to undertake noble task of making available level playing field to all its members. It should take initiative give justice to its members.
Ajay Salagare Chartered Accountant, http://pdicai.org/MyPage/121614.aspx |
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